The US Federal Trade Commission and attorneys general from 22 states have filed a lawsuit against Amazon, accusing it of secretly raising advertising fees for over a million brands and sellers over seven years, generating tens of billions of dollars. The complaint, filed in the US District Court for the Western District of Washington, alleges that Amazon changed its auction system from a second-price to a first-price model without disclosure, charging advertisers their full bid about 80% of the time by 2024, up from 30-40% in 2021. More than 500,000 small and medium-sized businesses are affected, and the states include California, New York, Florida, and Illinois. FTC Chairman Andrew N Ferguson said Amazon misled advertisers, and the higher costs were passed on to consumers. Amazon denies wrongdoing, stating that its advertising policies aim to show relevant ads and that average cost per click remained flat from 2019 to 2024.
Amazon.com IncFTC and 22 states sue Amazon over hidden ad fee hikes, alleging deceptive practices.
