FTC alleges Amazon illegally made $20 billion by rigging billions of ad auctions
Summary
The Federal Trade Commission (FTC) and 22 states have sued Amazon, saying the company overcharged advertisers for seven years by secretly raising prices in its ad auctions. The FTC claims Amazon replaced true auction results with higher prices to make more money, affecting about 1.2 million advertisers and likely costing them over $20 billion.Key Facts
- The FTC and 22 states filed the lawsuit against Amazon in a U.S. court in Washington state.
- Amazon runs auctions for ads shown on its site, where advertisers bid to display their ads.
- Since 2019, Amazon allegedly added hidden fees by setting higher prices than the auction results.
- These fees were called a “soft reserve price” internally and were not disclosed to advertisers.
- Amazon earned $200.6 billion in sales and $62.6 billion in profit in the second quarter of 2026.
- Amazon says the FTC chose only certain details and that its ad system does not harm advertisers or consumers.
- The FTC wants a permanent order to change Amazon’s ad pricing, plus fines and refunds.
- The case involves over 1.2 million advertisers whose ads include Sponsored Products, Sponsored Brands, and Sponsored Display ads.
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