Latest news with #StopAIPriceGougingandWageFixingActof2025
Fast Company
24-07-2025
- Business
- Fast Company
Companies use this sneaky pricing trick to overcharge you. One lawmaker wants it banned
It's no secret companies are collecting data while consumers browse their sites. But some companies are doing more with the info than trying improve products or marketing efforts: They are adjusting prices for individual customers based on their personal data. This practice, known as 'surveillance pricing,' has become more common in recent years, with more companies embracing artificial intelligence as a tool to make real-time price changes for individual customers. However, a new bill aims to stop these companies in their tracks. Representative Greg Casar introduced the 'Stop AI Price Gouging and Wage Fixing Act of 2025' on July 23. While some states—such as California, Colorado, Georgia, and Illinois—have proposed similar bans, Casar's bill is the first at the federal level. 'Giant corporations should not be allowed to jack up your prices or lower your wages using data they got spying on you,' Casar said in a statement. 'Whether you know it or not, you may already be getting ripped off by corporations using your personal data to charge you more. This problem is only going to get worse, and Congress should act before this becomes a full blown crisis.' How surveillance pricing works Companies engaging in surveillance pricing use customer data taken from the cookies—text files containing data—or tracking pixels that continue to follow you after leaving their website, providing information on your online activity, preferences, location, and device. This data can then be analyzed by AI programs to help the companies determine a personalized price for their products or services. The ban would impact the pricing systems of numerous retailers that reportedly engage in the practice, from retailers that increase prices for pickup orders when you are close to a store, to rideshare apps that charge more when your phone battery is low. Similarly, Delta Airlines recently came under fire for plans to expand their use of AI-driven pricing. 'We've seen things like people's browsing history, device type, battery, location, and more, inform pricing that focuses on how much that individual might be willing to pay for something—preying on desperation rather than using fair market pricing,' Ben Winters, director of AI and data privacy at the Consumer Federation of America, told Fast Company. (The Consumer Federation of America is one of several consumer-interest organizations and advocacy groups that have endorsed the proposed bill, according to a statement by Casar's office.) One of the benefits of the bill, Winters says, is that it would 'draw clear lines in the sand prohibiting the use of AI systems' to apply data-driven pricing on consumers, and provide customers harmed by this practice the right to sue the company behind the AI-driven prices. 'Too few bills focused on AI and data abuse have this key feature,' Winters says. 'It's one of many reasons we support the bill.' The Federal Trade Commission would be the entity responsible for enforcing the ban against surveillance pricing, which would be treated as a violation of two existing FTC acts regarding 'unfair or deceptive acts or practices' and 'unfair methods of competition,' according to the proposed bill. Surveillance pricing may be more common than you think Last year, the Federal Trade Commission launched an investigation into surveillance pricing, hoping learn more about how companies were using personal data to change prices. The initial results, released in January, found that retailers were using everything from demographic and location information, to mouse movements and abandoned online shopping carts, to match prices to consumers. 'Retailers frequently use people's personal information to set targeted, tailored prices for goods and services—from a person's location and demographics, down to their mouse movements on a webpage,' FTC Chair Lina M. Khan said in a statement earlier this year. The new legislation would not impact higher prices that result from 'reasonable costs' the business takes on to serve different customers, or lower prices from discounts for teachers, veterans, seniors, students, or rewards program members. Lawmakers and advocates that support the bill suggest the ban could make a big difference for consumers struggling to find fair prices amid rising prices and economic uncertainty. 'The ability to compare prices, to rely on consistent prices, and to know why a price is being charged—this is what gives us the power to know if we are getting a fair deal,' Nidhi Hegde, executive director at the American Economic Liberties Project, said in a statement. 'Surveillance pricing destroys the social contract of the marketplace.'
Time of India
23-07-2025
- Business
- Time of India
Democrat congressman Greg Casar introduces bill to ban AI-driven price; slams ‘surveillance pricing'; seeks Republican support
Representational image US congressman Greg Casar has introduced a new bill to stop what he calls 'AI-driven price gouging'. The bill, called the Stop AI Price Gouging and Wage Fixing Act of 2025, targets companies that use personal data to charge customers different prices for the same product, a growing trend known as surveillance pricing. Casar, a Democrat from Texas, says tech companies are going too far by spying on people's habits and financial history. 'Prices should be based on supply and demand and based on how much it costs to make and sell a thing, not based on spying on you and using your private data," he told NBC News. The move follows a recent federal trade commission ( FTC ) report that found companies were using users' browser history, GPS location and shopping behaviour to silently adjust prices. The practice is common in e-commerce, and often powered by artificial intelligence. The FTC study, released in January just before president Biden left office, revealed that big firms like Mastercard, JPMorgan Chase, Accenture and McKinsey were among those feeding AI systems with consumer data. FTC chair Lina Khan called the system a 'black box' where users don't even realise they're being charged more based on hidden profiling. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Chic, Calming, Kid-Friendly—All on a Budget squarerooms Read More Undo Casar's bill would also prohibit companies from using AI to determine wages based on personal financial data rather than job performance. Several US states are also cracking down. New York passed a law requiring businesses to inform customers when prices are set using algorithms. California may soon follow. But Casar's bill is the first push for a national ban. The House is about to go into recess, so the bill won't move before September. But Casar hopes both parties can get behind it. 'You don't have to be a progressive Democrat to say these gigantic corporations in the tech world should not be spying on us and then using what they learn to put it into AI and make our life more expensive,' he said.
NBC News
23-07-2025
- Business
- NBC News
This congressman wants to ban companies from using your search history to set personalized prices
WASHINGTON — From raising the price of diapers for new parents who recently searched for them online to stores excluding regular customers from discounts because they are likely to buy the product anyway, companies are using personal data to set different price points for different people. The practice, known as 'surveillance pricing," has caught the attention of Rep. Greg Casar, D-Texas, who wants to ban it at the federal level. Personal data collection has become commonplace in the internet age, with major corporations farming information to tailor marketing and sales pitches specifically to individual consumers. But companies are now using location data, browsing history and demographic background to individualize prices. Casar believes this practice, which is often done using artificial intelligence, could stack the deck against consumers, leading to higher, uneven prices. The lawmaker, who leads the Congressional Progressive Caucus, told NBC News he wants to ensure that prices are set 'based on supply and demand and based on how much it costs to make and sell a thing, not based on spying on you and using your private data.' The Stop AI Price Gouging and Wage Fixing Act of 2025, which Casar will introduce Wednesday, would prohibit the use of surveillance-based price and wage setting at the federal level. The bill comes on the heels of a study by the Federal Trade Commission and as some states seek to ban surveillance pricing as well. Casar said there needs to be more transparency around the use of consumers' data and artificial intelligence. His bill would also prevent the use of AI to set wages based on personal data, like an individual's financial history, rather than performance. 'AI is a developing part of our lives, part of our world, but we need to make sure that it's used for good and not being exploited,' he said. 'We're already starting to see that, and if we don't intervene now and ban these sorts of price gouging and wage suppression right now, then I think it's just going to spread all over the economy.' Casar's legislation comes after the FTC released the initial findings of its study of surveillance pricing in January. That report, released just before then-President Joe Biden left office, found that a 'person's precise location or browser history can be frequently used to target individual consumers with different prices for the same goods and services.' The FTC's findings are based on information it requested from eight companies that use consumer data when pricing products: Mastercard, Revionics, Bloomreach, JPMorgan Chase, Task Software, PROS, Accenture and McKinsey & Co. Lina Khan, who chaired the FTC under Biden, oversaw the study. It is unclear what the future of the FTC's role will be on this issue under the Trump administration, as the agency's call for public input on surveillance pricing was stopped when new leadership came in. 'One of the most pernicious aspects of surveillance pricing is that people may have absolutely no idea that they're being targeted by it,' Kahn said in an interview with NBC News. 'It's a total black box.' Kahn said the technology is rapidly evolving making it easier for companies to forecast how much a consumer is able or willing to pay without them knowing. Kahn described surveillance pricing as the 'holy grail' for companies looking to maximize profits in e-commerce. 'We have quickly slipped into an environment where companies now increasingly have the ability to do this based on just the enormous troves of personal data that are being collected about us, they have the incentive to do it," Khan said, adding that 'unless law enforcers and lawmakers are very clear about these practices being prohibited, companies will think it's totally fair game.' Casar noted that Delta Air Lines is one company that is integrating AI into its pricing. On an investor call this month, Delta president Glen Hauenstein said the airline's goal is to have a fifth of all its fares set by an artificial intelligence program, up from 3% currently. But the company disputed in a statement that prices would be set based on personal information. 'There is no fare product Delta has ever used, is testing, or plans to use that targets customers with individualized offers based on personal information or otherwise,' the company said. 'Delta always complies with regulations around pricing and disclosures.' While Casar's legislation is the first at the national level, several state legislatures have attempted to take on the issue. For example, the New York State legislature passed and the governor signed legislation to require companies to disclose to consumers when a price is set by an algorithm using their data. The National Retail Federation, earlier this month, asked a federal court to block the New York law, arguing that it would 'unfairly malign a system that helps merchants give customers lower prices and personalized offers.' The California Assembly, meanwhile, passed a bill in May to stop businesses from using personal data when charging different prices for the same product. That legislation next heads to the California Senate. At the federal level, the House of Representatives is leaving for its August recess this week, so no action can be taken on Casar's bill until September at the earliest. The congressman said he hopes to 'build a broad coalition of members of Congress against this, because I think this is the kind of issue that energizes people all across the country.' Casar sees a surveillance price ban as an issue that could attract bipartisan support. 'I think that's the kind of thing that pisses off Democratic and Republican and independent voters alike,' he said. 'You don't have to be a progressive Democrat to say these gigantic corporations in the tech world should not be spying on us and then using what they learn to put it into AI and make our life more expensive.'
