Attorney General Fox Urges Online Marketplaces to Prevent Pandemic Price Gouging

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Attorney General Fox Urges Online Marketplaces to Prevent Pandemic Price Gouging

Today, Montana Attorney General Tim Fox and other attorneys general urged Amazon, Facebook, eBay, Walmart, and Craigslist to more rigorously monitor price gouging practices by online sellers using their services.

“We want the business community and American consumers to know that we endeavor to balance the twin imperatives of commerce and consumer protection in the marketplace,” the attorneys general wrote. “And, while we appreciate reports of the efforts made by platforms and online retailers to crack down on price gouging as the American community faces an unprecedented public health crisis, we are calling on you to do more at a time that requires national unity.”

“When consumers can’t get reasonably priced products to protect their families and prevent the spread of coronavirus, our communities are at risk for serious health consequences as a result,” Fox said. “Online marketplaces aren’t exempt from price gouging laws, and companies like Amazon, Facebook, eBay, Craigslist, and Walmart need to step up and do more to prevent sellers from unconscionable mark-ups that violate consumer protection laws,” Fox added.

The letter lists several examples of price-gouging on these marketplace platforms, all of which took place just this month:

  • On Craigslist, a two-liter bottle of hand sanitizer was listed for $250
  • On Facebook Marketplace, an eight-ounce bottle was priced at $40
  • On eBay, packs of face masks were listed at $40 and $50

The attorneys general recommend several changes to protect consumers from price gouging:

  • Prevent exorbitant price increases from occurring in the first place by setting and enforcing price increase limits based on a 90-day average of the item’s price before an emergency begins.
  • Trigger price gouging protections prior to an emergency declaration, such as when your systems detect conditions like pending weather events or future possible health risks.
  • Implement a complaint portal for consumers to report potential price gouging.

Montana law protects consumers from unfair or deceptive trade practices and price fixing. Earlier this month, Fox warned Montanans of potential coronavirus scams and price gouging.  Anyone with coronavirus-related consumer complaints should call the Montana Department of Justice’s Office of Consumer Protection at (800) 481-6896 or (406) 444-4500, or email [email protected].

The attorneys general letters are available to view or download:

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