Since the nation and the world are affected by the COVID-19 pandemic, many goods are in short supply and in high demand. This basic economic formula means that prices rise – all the way up. Among the country's largest digital businesses, a combination of individual sellers to get banking and algorithmic prices, which may or may not have a basis in reality, has led to a wave of exploitative price cuts that government and state regulators are trying to stop.
Prosecutors general from 33 states and territories yesterday signed letters (PDF) asking online retailers to set and enforce policies that prohibit pricing on their platforms during this emergency.
"We are pleased to hear reports of platforms and online retailers' efforts to address price cuts," the attorneys general wrote to Amazon, Craigslist, eBay, Facebook, and Walmart. "However, we ask you to do more each time." that requires national unity. "
Hand disinfectants and face masks in particular are susceptible to price cuts, according to the AGs. Amazon prices are reported to have risen at least 50 percent above average, while individuals on Facebook and Craigslist sold Purell bottles for up to $ 250.
The problem, they write, is that the platforms are reactive rather than proactive – the problem that digital platforms typically face with all types of moderation. "Rather than playing blow to blow to stop price erosion after it is done, online retail platforms should primarily prevent inconspicuous price increases by creating and enforcing strict policies that prevent that Sellers differ significantly from this. " the usual base price of a product.
The AGs also acknowledge that some listings will likely still go through and call on all platforms to create simple fair pricing portals or landing pages where consumers can quickly and easily report discounts incidents directly to retailers when they come across them. and where retailers can easily collect the data themselves to share with the states.
The White House is also trying to take action against opportunistic price cuts. The government issued a regulation earlier this week to prevent and punish hoarding and fraud in critical health services. The Ministry of Health and Human Services and the Ministry of Justice are responsible for enforcing the order.
To this end, the DOJ set up a task force to look for price cuts and other types of hoarding, fraud, schemes and counterfeiting.
"Using this crisis to generate illegal profits or otherwise hunt Americans is reprehensible and will not be tolerated," said a memo on Tuesday (PDF) by Assistant Attorney General Jeffrey Rosen.
In response, eBay, Amazon, Facebook and Walmart made statements explaining their previous actions. For example, eBay has banned offers for hand disinfectant and disinfectant wipes and removed offers that reference COVID-19. Facebook said it removed similar entries from its marketplace. Amazon also said it removed about half a million third-party discount offers, and Walmart said it automatically cuts offers that are too above average.
