FTC alleges Amazon illegally made $20 billion by rigging billions of ad auctions
FTC says firm replaces actual ad-auction results "with higher prices set by Amazon."
The Federal Trade Commission (FTC) and 22 states have filed a lawsuit against Amazon, claiming the tech giant engaged in a secret scheme to overcharge advertisers for seven years, according to a report. The lawsuit alleges that Amazon.com, Inc. systematically manipulated auctions used to set ad prices on its platform, from 2019 onwards, resulting in an estimated $20 billion in additional costs for Amazon's approximately 1.2 million advertising customers.
Amazon claims its auctions set advertising prices on its e-commerce website, but the FTC argues the company overrides auction results with higher prices to boost profits. Internal documents and messages obtained by the FTC revealed how Amazon inflated auction prices for Sponsored Products, Sponsored Brands, and Sponsored Display advertisements displayed alongside consumer searches for products. The FTC's investigation into Amazon's practices commenced in 2024.
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