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Amazon discounts are misleading you, consumer group says

The Federal Trade Commission reportedly is looking into Amazon's discount policy after a Consumer Watchdog complaint.

Amazon Buys Whole Foods For Over 13 Billion
The FTC is looking into Amazon's discount policy, after Consumer Watchdog claims it's misleading customers. 
David Ryder / Getty Images

The US Federal Trade Commission is investigating charges that Amazon's pricing policy is misleading customers, according to a report by Reuters. That follows from a complaint by the Consumer Watchdog group, which examined 1,000 products being sold at a discount on the online retailer's site in June. 

Consumer Watchdog found that Amazon's reference prices, which were found on roughly 46 percent of the products, were listed higher during the sale than in the 90 days leading up to it -- making customers think they're getting a better deal than they actually are. These results prompted a letter to the FTC on July 6, urging the agency to investigate Amazon's discount policy, Reuters said.

That dovetails with an examination of Amazon's plans to purchase the health food grocery chain Whole Foods for $13.7 billion, announced in June. Consumer Watchdog has urged the FTC to prevent the sale as long as Amazon's "deceptive" pricing discounts continue. 

"The study issued by Consumer Watchdog is deeply flawed, based on incomplete data and improper assumptions," an Amazon representative told me via email. "The conclusions the Consumer Watchdog group reached are flat out wrong. We validate the reference prices provided by manufacturers, vendors and sellers against actual prices recently found across Amazon and other retailers." 

The FTC declined to comment on this story.