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Blumenthal, Moran Seek Answers from FTC on Price Gouging Amid Pandemic

“[W]e believe the [FTC] has a duty to prevent unscrupulous and harmful commercial practices taken by bad actors against consumers during the current coronavirus pandemic”

[WASHINGTON, D.C.] – Amidst reports of rampant price gouging of vital consumer health items, U.S. Senators Richard Blumenthal (D-CT) and Jerry Moran (R-KS), Ranking Member and Chairman of the Senate Commerce Subcommittee on Manufacturing, Trade, and Consumer Protection, called on the Federal Trade Commission (FTC) to clarify its enforcement authority to protect consumers during the COVID-19 pandemic. While the FTC has taken steps against pandemic-related scams and fraud, the Commission has not taken action on price gouging or clarified its enforcement authority over price gouging.

“Consumers, especially those who are medically at-risk or essential workers must protect themselves with PPE and sanitary items, such as face masks and disinfectants. When these basic health products are inappropriately priced,” consumers face extreme obstacles to protecting their health – especially as they face new financial pressures and dwindling supply of these types of goods,” wrote the Senators in a letter to FTC Chairman Joseph Simons. “The FTC should be just as vigilant as ever during the COVID-19 pandemic, and while the Defense Production Act and the recent Executive Order signed by the President provide clear authorities to the Department of Justice to pursue criminal enforcement actions against bad actors found to use hoarding as a price gouging tactic related to certain designated critical supplies, we believe that the FTC should provide clarity to the public on what its current enforcement authorities include as it relates to price gouging.”

The Senators pointed to the “powerful set of tools” the agency was given to protect consumers when it was created by Congress, in particular the FTC Act’s prohibition on “unfair or deceptive acts or practices in or affecting commerce,” which empowers it to seek injunctions and further equitable relief to enforce the law. The Senate Commerce Subcommittee on Manufacturing, Trade, and Consumer Protection has oversight responsibility for the FTC.

The Senators emphasized the need for the FTC to provide clear public guidance into its power, affirm when it would be exercised, and asked if any resources would be helpful in facilitating the agency’s action against cases of price gouging.

The full letter is available here.