WASHINGTON — Sen. Josh Hawley (R-MO) issued a stark warning against what he called "surveillance pricing," an AI-driven practice he labeled "one of the biggest scams in American history" — one in which companies use Americans' personal data to determine the highest price a consumer will pay.
Hawley highlighted a specific case involving JetBlue Airways. A customer booking travel for a funeral said the price of a flight jumped $230 in a single day.
"They're going to figure out how they can rip you off one person at a time," Hawley said. The method relies on algorithms that analyze personal data to predict how much an individual will pay.
Companies collect consumer data including browsing history, purchase patterns, location information and demographic details. That data feeds AI models designed to tailor prices to individual profiles.
The practice extends beyond airline tickets to hotel rooms, rental cars, insurance premiums and online retail. Critics argue it creates an unfair market where consumers have no visibility into how their price was set.
Existing consumer protection laws, built for traditional pricing models, are poorly equipped for AI-driven dynamic pricing. Lawmakers and regulators are working to catch up.
Companies that use dynamic pricing defend it as real-time adjustment to supply and demand, arguing it can surface personalized deals and manage inventory more efficiently.
The Federal Trade Commission holds jurisdiction over unfair or deceptive business practices and could investigate AI-powered pricing algorithms if a formal complaint or legislative push forces the issue.
Hawley sits on the Senate Commerce Committee, which could hold hearings on AI and consumer protection — amplifying pressure on companies to disclose their pricing methods or face new regulation.
Consumers in urgent situations, like the JetBlue traveler booking a funeral flight, have little leverage: they face unpredictable costs and prices that rise precisely because their circumstances signal they will pay.
