Amazon – The Perfect Marketplace for Counterfeits

Consumers deceived, and Amazon’s credibility problems grow.

May 4, 2017, Los Angeles, CA – Counterfeit products are replicas of real products, designed to take advantage and profit from the superior value and reputation of the authentic product.

Amazon is proving to be an ideal platform facilitate distribution of some $1.7 trillion in global counterfeit goods, which are expected to top $2 trillion in 2022. Counterfeiting is profitable, difficult to track and widely unpunished. The benefits are drawing an avalanche of counterfeit listings from both U.S. and global sellers.

The problem is that anybody, anywhere, can sell just about anything on Amazon, conveying Amazon’s endorsement and giving consumers the illusion they are buying from Amazon.

Many Amazon consumers don’t realize Amazon listings present products from any of three distinct sources, including 2-million global Marketplace account holders (about 50% of Amazon’s business) who can ship counterfeit products, which are never inspected by Amazon, from all over the world. Buyers must look very closely to determine the source of items;

1. Amazon Direct (Amazon a direct retailer “Sold and Shipped by Amazon”)
2. Amazon Fulfillment (provided to Amazon by any global third-party seller just for warehousing and shipping)
3. Amazon Marketplace (sold and shipped directly from any global third-party sellers)

Amazon would like consumers to believe that Amazon is a safe place to buy name-brand goods, but that is just not true;

• Apple® reported that 90% of Apple products it purchased directly from Amazon were counterfeit.
• The Recording Industry Association of America (RIAA) placed orders with Amazon and found that 44 of the 194 top CD's delivered were counterfeit.
• Birkenstock® pulled the plug on Amazon sales of its popular sandals citing counterfeit enforcement problems.
• A Tennessee family is suing Amazon for $30 million after a counterfeit hoverboard caught fire and completely destroyed their $1 million Nashville home and personal property in 2016, injuring two of the family’s four children.
• Despite notifications from the rights holders, Amazon does not notify buyers the item they received is fake. Of course, consumers would then be entitled to a refund.

Investigation
The Counterfeit Report, a consumer advocate and watchdog, sent formal infringement notices, authorized by the trademark holders, to Amazon for 21,048 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.

• A variety of fake items - items that bear a manufacturer’s trademark but never existed in the authentic manufacturer’s product line - were repeatedly reported to Amazon, but the items continue to be listed.
• After notifying Amazon of infringing listings, Amazon often reported the items were removed, but they were not, or remained on other global Amazon websites under the exact same Amazon listing ID.
• Amazon staff removed infringing listing content, but allowed the still identifiable counterfeit item to remain.
• Amazon seller profiles do not indicate punitive action by Amazon for counterfeit sales, and counterfeit sellers may remain despite repeated counterfeit complaints.
• Amazon does not notify buyers they purchased a fake.

In addition to trademark infringement, at issue is Amazon’s illusory claim "The sale of counterfeit products, including any products that have been illegally replicated, reproduced, or manufactured, is strictly prohibited" - but the fact is that counterfeit and replicas can be, and are, easily listed and sold on Amazon.

For example, inarguable replica current issue FBI, Secret Service and other law enforcement badges (shown below) were purchased and reported to Amazon. An Amazon Leadership Team Manager dismissed the complaints, claiming the items were “replicas,” and therefore OK on Amazon.  

Amazon’s Director of Product Integrity, Melissa Kriz, responded to the fake badge complaints confirming the items are “restricted” on Amazon. Ms. Kriz added  “Please do let us know if there are other similar products that you find and we will take swift action to remove” - hardly demonstrative of a proactive effort by Amazon to protect the public and remove remaining items that are available to terrorists, child predators and other criminals.

Would you suspect these counterfeit products listed on, or purchased on Amazon?

(Photo: The Counterfeit Report® - left to right)

1. Tiny microSD® computer memory cards are used in cell phones, cameras and laptops.  Authentic microSD cards bear the microSD trademark which owned by SD-3C, LLC, who licenses its use to authentic, conforming products. Memory on counterfeit cards is usually not the capacity of what is published on the card, and the fake items may fail. When that happens, you are likely to lose your data, images, and damage your equipment. None of the items shown above from Amazon are authentic. There is no such product as a 64GB microSDHC® card - an obvious fake, yet many infringing variations of the fake products remain listed.
2. U.S. based Fullips, LLC is a family owned business producing very popular beauty and cosmetic products under the registered Fullips® trademark. Unscrupulous counterfeiters will produce anything to deceive consumers and make a fast dollar, including the counterfeit Fullips product shown. Almost visually indistinguishable from the authentic product, consumers are easily deceived into purchasing a poor quality counterfeit that may contain dangerous lead and other suspect ingredients.
3. Federal, State and local laws regulate the sale, purchase, possession and display of counterfeit badges, as of course does common sense. Replica current issue U.S. Secret Service, FBI and police badges are available on Amazon to terrorists, child predators and other criminals. Notices to Amazon management of the alarming practice went ignored for months, until confronted with test purchases. The items remain. (Note: The CIA does not issue badges, but use of the Central Intelligence Agency Seal is a crime)  
4. The authentic Skunk2® performance shift knob is only available in a matte titanium (grey) finish. Authentic Skunk2 knobs were never made in colors such as red, blue, green, neo, gold, etc. Colored Skunk2 knobs are obvious fakes.
5. Composite Resources Combat Application Tourniquet® (C-A-T®) has been supplied to the U.S. Military, police, first responders, and the public worldwide for the past decade. Counterfeit versions of the C-A-T tourniquet have catastrophically failed during actual life-saving applications. The Counterfeit Report reported 1,595 infringing items to Amazon, yet infringing items continue to be listed, as well as non-FDA registered knockoffs of the critical medical device.
6. Drew Tech's MongoosePro interface cable is used by vehicle technicians and dealers to program vehicle computers including braking, emission and safety equipment. Counterfeit Mongoose® products may severely damage a vehicle, and install malware on your computer. The authentic product is not made in purple - an obvious fake.
7. Vans® does not make iPhone 6 cases – yet they are common on Amazon. Counterfeit product sales support terrorists, organized crime and other criminals.

The cutthroat competition of Amazon pricing and a very real possibility of receiving a counterfeit does not facilitate a safe environment for consumers.

A recent CNBC Report says it best; “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.”

If Amazon wants to maintain any consumer trust, they need to cleanse dishonest and fraudulent sellers and close counterfeit loopholes that enable and facilitate a criminal underground economy that dislocates hundreds of thousands of legitimate jobs, destroys brand reputations, forces higher burdens on tax payers, exposes consumers to dangerous and ineffective products, and deprives governments of revenues for vital public services.

Will they?