In 2020 alone, Amazon reported that it had invested over 700 million US dollars (around 600 million euros) to combat counterfeiting, fraud, and abuse on its platform. The company said it employed more than 10,000 people and used both automated checks via machine learning and checks by experienced investigators to ensure that only originals are sold. As a result, according to the online retailer, less than 0.01 per cent of the products sold on Amazon last year were received a counterfeit complaint from a customer.
After launching its Counterfeit Crimes Unit (CCU) one year ago, in which experienced investigators and data analysts work together, Amazon is now taking stock of the unit’s work: According to the company, its CCU has provided more than 250 in-depth leads to law enforcement agencies in the USA, the EU, the UK, and China. With the CCU, Amazon also initiated 64 civil cases against counterfeiters in the USA and cooperated closely with authorities as well as with brands such as Asmodee, Valentino, or GoPro, in some cases also in joint legal proceedings with brand owners.
In a recently published Amazon white paper, the company, which often faces accusations of lacking commitment against counterfeiting, now also argues that other players must do more to fight fakes. According to that, better communications and coordination are needed, both between companies and between business and authorities. Amazon also calls for more resources for law enforcement agencies so that they can take more effective action against counterfeiters.
Based on a recently published study, the Buy Safe America Coalition, warns that online marketplaces for third-party retailers, such as Amazon Marketplace, are flooding the market with counterfeits. “Make no mistake, Amazon lets criminals make a living peddling hazardous knockoffs and stolen merchandise on its platform,” said Michael Hanson, spokesperson of the Buy Safe America Coalition, according to a further recent statement by the association. Amazon, on the other hand, pointed out that the study was co-sponsored by brick-and-mortar retailers, which would see online marketplaces as a threat.
Another accusation that is currently drawing attention is that smaller suppliers are less well protected by Amazon than well-known brands such as Adidas, Apple, or Amazon itself. While big brands benefit from digital protection mechanisms, less well-known brands have no such protection, according to media reports. A report presents the case of the smaller manufacturer SnugglyCat, which sells cat toys in the USA: Fred Ruckel, inventor of the cat toy, noticed numerous counterfeits of his product on Amazon a few months ago. As Amazon combines identical products on one product page and as the counterfeiters offered a lower price, they gained a better placement in the so-called Buy Box and could therefore make the first offer that the customer sees and is most likely to buy. Although Amazon removed the offers initially reported by Ruckel from the platform, new sellers offering imitations of the product kept popping up regularly. In the meantime, Ruckel has received additional support from Amazon.
New legislative initiatives for online trade are currently being discussed in both the EU and the USA. The proposals could also make important online marketplaces more accountable in the fight against counterfeiting. Amazon has recently faced repeated sharp criticism for trading in counterfeits. At the beginning of the year, for example, European Amazon sites were included on the US government’s Notorious Markets negative list. Previously, accusations by former employees that counterfeit protection was not a priority for Amazon attracted attention.
