Ecommerce platforms are under scrutiny for their listings of high-demand items at exorbitant prices as people complain of price gouging during the coronavirus outbreak - including lawmakers and regulators.
Online sellers have both defended the practice as capitalism's supply-and-demand model and condemned the practice as exploitive during a public health crisis.
But however they feel about it, sellers are at risk of the consequences of the crackdown, from false positives to prosecution.
Amazon announced yesterday it is collaborating with federal, state, and local law enforcement agencies and policymakers to hold price gougers accountable.
"If we find a price that violates our policy, we remove the offer and take swift action against bad actors engaged in demonstrated misconduct, including suspending or terminating their selling accounts and referring them to law enforcement agencies for prosecution under relevant laws."
The poster child of "price gouging" was the seller profiled in the New York Times in early March who reportedly bought up nearly 18,000 bottles of hand-sanitizer to sell on Amazon. He donated the bottles after a backlash, and the state Attorney General began an investigation.
A quick Google search finds that each state has its own way of dealing with the issue. The Tennessee AG website has a page devoted to price gouging, explaining what it is and the consequences, which it explains as the following: "Under the law, the Attorney General's Office can put a stop to price gouging and seek refunds for consumers. The courts may also impose civil penalties ($1,000 per violation) against price gougers."
To some who are outraged about the items and prices turning up on marketplaces, it feels like platforms are swatting at listings that violate the bans, such as eBay's ban on face masks and other items.
And some sellers say the marketplaces are issuing takedowns for listings that have nothing to do with the COVID-19 outbreak - in other words, "false positives." We've heard of eBay removing listings for golf putters and clothing, with some reporting receiving the following message:
"We had to remove your listing because it didn't follow our Disaster and tragedy policy. Listings or items that portray, glorify, or attempt to profit from human tragedy or suffering, or that are insensitive to victims of such events, are not allowed."
It's *almost* humorous to see what can get trapped in the coronavirus policy net: "I put some high-dollar items on a special sale to try to bring in some cash and called it a "Cabin Fever" sale," one reader explained in a Facebook comment. She was taking 30% off of $500 item type stuff, and one item got reported as violating eBay's policy - "I was extremely confused because it was a Thermador Hood Vent Motor," she said.
When she finally got a response from eBay, it turned out the word "Fever" in her "Cabin Fever" sale caused the item to be removed. "I quickly changed the name of my sale."
"Amazon's inability to deliver household staples such as toilet paper and bleach to many customers has led the company to reduce sales of nonessential items and prioritize shipping to members of its $119-a-year Prime service," according to the newspaper (which is owned by Amazon cofounder and CEO Jeff Bezos).