Six people were charged with paying more than $ 100,000 in bribes to Amazon employees and contractors as part of a program to unfairly benefit third parties in the Amazon marketplace. The indictment states, among other things, that Amazon employees who accepted bribes reinstated sellers whose accounts had been banned for selling dangerous products, and that those employees banned the seller accounts of rival fraudulent sellers.
The US Department of Justice announced today that a grand jury had been indicted in the western district of Washington. The "defendants paid bribes to at least ten different Amazon employees and contractors," the DOJ said. In one case, a 31-year-old defendant named Nishad Kunju "accepted bribes as a seller support agent in Hyderabad, India before becoming an outside consultant who recruited and paid bribes for his former colleagues," the DOJ said.
In return for bribes, Amazon employees granted "hundreds of (third-party) seller accounts, which allegedly represent the defendants, fraudulently and unfounded competitive advantages in the tens of millions," according to the indictment. The DOJ said staff "helped recover products and merchant accounts that Amazon blocked or completely blocked from doing business on Amazon Marketplace," and that "the fraudulently reinstated products contained dietary supplements that were made due to complaints about the Customer safety was exposed, as well as household electronics marked as flammable, consumer goods marked for intellectual property infringement, and other merchandise. "These fraudulently recovered seller accounts included those that Amazon" exposed for tampering with product reviews for consumers mislead, improper contact with consumers and other violations of Amazon seller policies and codes of conduct, "the DOJ said.
The previously suspended traders made over $ 100 million from Amazon sales after their "unfounded and fraudulent reinstatement," the indictment said. The program began in July 2017 at the latest and lasted until September 2020, according to the indictment.
In addition to Kunju, the defendants were Ephraim Rosenberg (45) from Brooklyn, New York; Joseph Nilsen, 31, and Kristen Leccese, 32, from New York City; Hadis Nuhanovic, 30, of Acworth, Georgia; and Rohit Kadimisetty, 27, of Northridge, California. The defendants, who bribed Amazon workers, acted as advisors to third-party sellers, the DOJ said. Three of the defendants – Nilsen, Leccese and Nuhanovic – also allegedly "made their own sales on the Amazon Marketplace through (third-party) accounts they operated".
Attacks on competitors alleged
In order to give the sellers an additional advantage over their competitors, the bribed employees and contractors "facilitated attacks on accounts and product lists of competitors (third-party suppliers) by (a) exchanging competitive information about the competitors' revenues, customers, advertising campaigns and suppliers; b ) Using their internal access to the Amazon network to block the accounts of competitors (third-party providers), and (c) Providing information about Amazon's internal algorithms, which enabled the consultants to identify the product lists of competitors with fictitious negative product reviews said the DOJ.
The bribes also helped third-party sellers and consultants gain "unauthorized access to Amazon's highly confidential standard operating procedures and algorithms," and provided "coveted insights into the systems that run Amazon's search engine, Amazon's product reviews, and its enforcement processes Support Amazon, "the DOJ said.
Bribed workers provided contact information for Amazon employees and consumers "that the members of the conspiracy abused and widely distributed," the DOJ said. Bribery workers have also circumvented Amazon rules by "increasing the warehouse limits of (third-party) sellers in Amazon's warehouses, (third-party) sellers making otherwise baseless requests to sell products in restricted categories, and (third-party) Giving sellers the opportunity to have inside knowledge of the most successful advertising campaigns and most profitable product listings, "said the DOJ.
The six defendants were charged with conspiracy to use a communications device to commit commercial bribery, conspiracy to unauthorized access to a protected computer, conspiracy to commit cable fraud, and cable fraud. The wire fraud charge alone "carries up to 20 years in prison and fines" $ 250,000, "while the other charges" carry up to five years in prison and a fine of $ 250,000, "the DOJ said .
Amazon said it fired workers who took bribes and helped federal investigators in the case. "Amazon has systems in place to detect suspicious behavior by sellers or employees, and teams to investigate and stop prohibited activity," the company said when contacted by Ars today. "We are particularly disappointed with the actions of this limited group of former employees and appreciate the cooperation and support from law enforcement agencies to bring them and the bad actors they have been associated with to justice. There is no place for fraud on Amazon and We will continue to do everything we can to protect our business and hold bad actors accountable. "