The Federal Trade Commission (FTC) has confirmed that it has launched an investigation into allegations of tech giant Amazon’s misleading pricing discounts.

The FTC is looking into the allegations as part of its ongoing review of Amazon's deal to acquire Whole Foods.

The federal agency is looking into a complaint that was brought by the widely famous advocacy group Consumer Watchdog. It filed the complaint after looking at some as many as products on Amazon’s website and finding that the online retailer put reference prices or list prices on 46 per cent of them.

In a letter to the FTC on 6th of July, the group wrote that it found that in 61 per cent of products with reference prices, the online retailer’s reference prices were higher than it had sold the same products in the preceding 90 days.

However, Amazon denied has any wrongdoing. Online markets offer massive discounts at times and in certain products they even face loss for every sale. Amazon has been steadily gaining customer base for its Prime subscription service.

When asked for a comment, Amazon said, “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 is playing a dual role of investigating charges of deceptive advertising as well as assessing the proposed Amazon-Whole Foods merger. The online retail giant announced in June that it would acquire the grocer for $13.7 billion.