A grand jury in Washington State has indicted six people over allegations of bribery and illegal practices on Amazon's e-commerce platform. The indicted reportedly bribed Amazon employees to gain an unfair advantage over competing listings, among other practices.
According to the Department of Justice, the six, including two former Amazon employees, spent more than $100,000 since 2017. Through their inside contacts, the people were able to circumvent Amazon's restrictions and filters allowing them to post listings of defective, fake and dangerous products.
Among the products posted were dietary supplements banned by Amazon owing to safety complaints. The same people also listed low quality household electronic devices that were flagged as fire hazards. Some of the products listed had earlier been removed by Amazon for intellectual property violations.
Apart from gaining an unfair advantage over competitors, the defendants reportedly attacked direct competitors of their products by flooding their listings with fake negative reviews. The former employees provided the defendants with inside knowledge - including internal information on specific listings.
Authorities said three of those indicted were based in New York. The others were from California, Georgia, and India. The six defendants face wire fraud, bribery and unauthorized system-access charges. Wire fraud charges in the state carry 20-year prison sentences.
Federal Bureau of Investigation in Seattle special agent Raymond Duda said in a statement the defendants likely couldn't compete on Amazon on a level playing field so they turned to bribery and fraud to gain an upper hand. What made their crimes worse, Duda said, was that they were actively going after legitimate competitors on the site.
Amazon said in a separate statement it didn't have automated or manual systems that detect suspicious behavior and listings. It said it had a specialized team to investigate reports of prohibited activity, however.
"We are especially disappointed by the actions of this limited group of now-former employees and appreciate the collaboration and support from law enforcement to bring them and the bad actors they were entwined with to justice," Amazon said.
