FTC lawsuit alleges Amazon has been ‘secretly and systematically’ overcharging for ads

Sep 01, 2026 04:41 AM - 1 hour ago 1

Amazon responded saying the FTC’s declare “fundamentally misunderstands really advertisers behave.”

by Stevie Bonifield

Aug 31, 2026, 9:41 PM UTC

Illustration of Amazon’s logo connected a black, orange, and tan background.

Illustration by Alex Castro / The Verge

Stevie Bonifield

is a news writer covering each things user tech. Stevie started retired astatine Laptop Mag penning news and reviews connected hardware, gaming, and AI.

The FTC and 22 authorities attorneys wide are suing Amazon for allegedly utilizing a “secret advertisement surcharge” to thrust up prices for ads connected its website and app. FTC president Andrew Ferguson claims successful a blog station connected the suit that the higher advertizing prices “were mostly passed connected to American consumers.” According to the complaint, Amazon violated the FTC Act and complete a twelve authorities laws. This suit comes almost a twelvemonth aft Amazon agreed to salary $2.5 cardinal to settle an earlier FTC lawsuit complete Prime subscription practices.

In Amazon’s “second price” auctions for ads connected its platform, the winning bidder is expected to only salary 1 cent much than the second-highest bidder. However, the FTC’s title alleges that Amazon has been “manipulating” the auctions since 2019:

Amazon’s advertizing statement (“Amazon Ads”) decided to group and complaint customers higher prices for advertizing placements itself. After Amazon runs its advertisement auctions and determines the winning and second-place bidders, it past replaces the value wished by the auction pinch a higher value designed to maximize Amazon’s profits and alteration the costs ratio of its advertisers’ campaigns. As explained internally by Amazon’s Senior Vice President successful complaint of Amazon Ads, successful Amazon’s auctions “the 2nd value isn’t group by an existent bidder, but alternatively by” Amazon successful the shape of a “proxy 2nd value that we calculate.”

The title claims this believe “has apt illegally extracted complete 20 cardinal dollars from [Amazon’s] unwitting advertizing customers.” Amazon responded successful a blog post saying the FTC’s suit is “misguided” and claiming that “from 2019 to 2024, the mean winning bid for Sponsored Products hunt ads fell 50%.” It besides disputed the FTC’s declare that higher advertizing prices were passed connected to consumers.

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