Facebook, Amazon, Walmart, eBay and Craigslist must do more to combat price gouging during the COVID-19 outbreak, according to a letter sent by New Jersey Attorney General Gurbir Grewal and 32 other attorneys general Wednesday.
It is “especially important” that “unscrupulous sellers do not take advantage of Americans by selling products at unconscionable prices” during this “unprecedented public health crisis,” the attorneys general wrote.
These companies have already taken various steps to address price gouging on their online marketplaces, but because it’s still happening, the companies must do more to protect consumers during emergencies, according to the attorneys general.
“Stay-at-home and social-distancing policies are leading more and more consumers to shop online,” said Grewal in a statement. “It is essential that online marketplaces that are benefiting from this public health crisis –while our residents and the brick-and-mortar stores in our communities struggle – do everything they can to prevent sellers from preying on consumers by charging inflated prices.”
The letter urges the websites to block third-party sellers from significantly increasing prices above those charged before an emergency. Price increases are currently allowed, and products are only removed from the marketplace in response to complaints.
Each company should create a “fair pricing” page or portal where consumers can report price-gouging incidents to the companies directly, the AGs wrote.
By Monday afternoon, the Division of Consumer Affairs received about 1,500 consumer complaints about approximately 1,000 business locations.
Complaints allege unfair price hikes on items such as surgical masks, hand sanitizer, disinfectant sprays and wipes, food, and bottled water—some of which were being offered for sale in online marketplaces. DCA investigators have conducted approximately 300 inspections to date and county consumer protection offices have conducted at least 75 more. The DCA has issued 167 cease-and-desist letters and served 32 subpoenas.
“In New Jersey, charging exorbitant prices for essential items during a declared state of emergency is not only unconscionable, it’s illegal,” said Paul Rodríguez, acting director of the Division of Consumer Affairs, in a statement. “Whether you operate a major online marketplace or run a corner store, we expect you to obey the laws in place to ensure that all New Jersey residents have access to critical supplies during this nationwide health crisis.”
Documented price hikes include a 50 percent increase in the price of hand sanitizer and facemasks on Amazon; an 8 oz. bottle of Purell Advanced hand sanitizer for $40; a two-liter bottle of Purell Advanced for $250 on Craigslist; and packs of face masks for $40 and $50 on eBay.
While many over-priced items have been removed from these websites, the attorneys general continue to receive daily complaints about online prices, according to the letter.