Amazon Turns a Blind Eye to Counterfeits

Amazon’s Marketplace proving to be an ideal counterfeit outlet.

March 2, 2017 - Los Angeles, CA – Counterfeit problems are growing for Amazon as sellers overwhelm the web platform. Complaints are mounting, and legitimate manufacturers are suffering.

Counterfeit sales can be a lucrative revenue source for the e-commerce giant, as transaction fees are charged for each sale of fake goods.  Amazon’s 2-million un-vetted Marketplace account holders, now 40% of Amazon’s business, can ship counterfeit products which are never inspected by Amazon from all over the world to unsuspecting consumers.

These counterfeit products, which appear right next to authentic items, convey Amazon’s endorsement and the illusion they are from Amazon. Business Wire reported that Amazon Marketplace Sellers sold more than 2-billion items worldwide.

At issue is Amazon’s claim  "The sale of counterfeit products, including any products that have been illegally replicated, reproduced, or manufactured, is strictly prohibited" -- but that is not true. The fact is that counterfeit and replicas can be, and are, easily listed and sold on Amazon. While the selling is illegal and prohibited, legitimate manufacturers are being harmed in a big way and have little recourse.

The Counterfeit Report, a consumer advocate and watchdog, sent formal infringement notices, authorized by the trademark holders, to Amazon for 32,626 infringing items offered on Amazon in just the past year. The Counterfeit Report also conducted dozens of name-brand test purchases from Amazon Fulfillment and Amazon Marketplace sellers, but never received an authentic item.

Alarmingly;

• Amazon claims that the infringing listings are removed – but that is not true. Many listings remained even after repeated complaints. Melissa Kriz, Amazon's Head of Product Integrity, vowed to resolve the issue for months – but it was simply lip service.
• If a listing was removed from Amazon’s U.S. website (Amazon.com), inexplicably, the same listing, with the exact same Amazon listing ASIN (item ID number), could be found on Amazon’s United Kingdom website (Amazon.co.uk) or other global Amazon websites.
• Despite the Amazon required formal counterfeit take-down notifications, Amazon does not notify consumers that they may have received a dangerous or potentially deadly counterfeit product. Of course, consumers would then be entitled to a refund.

Counterfeits are a familiar problem on the web. eBay has been dealing with counterfeits since its early days, and Chinese e-commerce giant Alibaba, appropriately named after the fable “Ali Baba and the 40 Thieves,” is listed on the United States Notorious Marketplace List for selling fakes.

“In Amazon's quest to be the low-cost provider of everything on the planet, the website has morphed into the world's largest flea market — a chaotic, somewhat lawless, bazaar with unlimited inventory” says a recent CNBC Report.

If Amazon wants to maintain any consumer trust, it needs to cleanse dishonest and fraudulent sellers from its website and close counterfeit loopholes. Web platforms that facilitate criminal activity and benefit from the proceeds of dishonest actions which impact jobs, consumer safety and public trust create a public perception of deception and impunity. However, reputation damage is only a small part of the problem: counterfeiting costs U.S. manufacturers over $250 billion, U.S. workers over 750,000 jobs and supports terrorists, organized crime and other criminals.

Amazon can adopt real and effective solutions in clear, truthful and professional manner to end the counterfeiting problem that it enables.

Will it?