Amazon is being scrutinized by the U.S. Federal Trade Commission over whether its discounts on goods are misleading, after a watchdog group complained, says Reuters, citing an unnamed source.

Shares of Amazon (AMZN) are down by $3.18 at $1,025.52, in late trading, after Reuters’s Diane Bartz and Jeffrey Dastin related after market close that the U.S. Federal Trade Commission is looking into allegations “Amazon misleads customers about its pricing discounts,” citing a single unnamed source.

Bartz and Dastin relate that the FTC received complaints on 1,000 products listed on Amazon by a consumer advocacy group called Consumer Watchdog, claiming "in 61% of products with reference prices, Amazon's reference prices were higher than it had sold the same product in the previous 90 days."

The FTC declined to comment on the matter to the authors. Amazon told the authors that the Consumer Watchdog study was “deeply flawed."

The authors write that the matter is linked to Amazon announcement it will acquire Whole Foods Market (WFM) for $13.7 billion, given the FTC has to review the deal, and given Consumer Watchdog “asked the FTC to stop amazon from buying Whole Foods while the deceptive discounting is occurring."

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