Amazon is being sued by the U.S. consumer protection agency (FTC) and by 22 U.S. states for manipulation of advertising auctions on its e-commerce platform. The complaint was filed this week in a federal court in Seattle, where the tech giant is headquartered, accusing the company of having secretly and systematically overbilled 1.2 million advertisers, of which more than half a million are small and medium-sized businesses.
According to the accusation, Amazon allegedly manipulated the pricing system for promotional tools, such as sponsored displays that privilege products in search results, allowing supplementary revenue of 20 billion dollars (17.2 billion euros) since 2019. The FTC alleges that the company began changing its auction strategy in 2018 to increase prices paid by advertisers imperceptibly.
The complaint states that inflated advertising costs contribute to consumers paying higher prices, since advertising fees, combined with account fees, referral fees, and logistics fees, reduce sellers' profit margins, leading to price increases passed on to consumers.
Amazon rejected all accusations, guaranteeing that no advertiser pays more than the winning auction price and that the average cost per click remained stable between 2019 and 2025, adjusted for inflation. This is already the third major lawsuit brought by the FTC against the company in recent years.
