Amazon Drops $700 Million To Weed Out Fake Products

CBx Vibe:Fake Love” Drake

By CultureBanx Team

  • Amazon seized and destroyed more than 2M counterfeit products, investing more than $700M
  • African Americans could be at a greater disadvantage than their counterparts when it comes to counterfeits products sold on Amazon

As pressure mounts to weed out the fake products on its platform, Amazon’s (AMZN +0.38%) ‘Counterfeit Crimes Unit,’ seized and destroyed more than two million counterfeit products, investing more than $700 million to combat the problem. Even though small businesses are raking in tons of cash on the e-commerce giant’s website, African Americans could be at a greater disadvantage than their counterparts when it comes to counterfeit products cutting into their profits. Just how effective is this initiative to show customers, and legitimate retailers that it’s tough on e-commerce crime?

Why This Matters: Consumer deceit is problematic in its own right, but counterfeit and dangerous products pose far more significant risks — and the ramifications can be serious. African American entrepreneurs’ reputation could be tarnished due to fake products, notably resulting in a smaller income. They are considered the fastest-growing group of entrepreneurs, but Black Americans are still a relatively small percentage of business owners.

The scale of the problem is alarming. In fact, in one particularly high-profile instance this year, regulators identified Amazon as hosting hundreds of thousands of recalled products that pose life-threatening risks to consumers.

Fighting off the counterfeit product breeding ground isn’t new for Amazon. The company spent more than $500 million in 2019 to fight various forms of fraud, including counterfeit products, employing more than 8,000 people as part of the overall effort, and blocking more than 6 billion “bad listings” during that year.

Situational Awareness/What’s Next: Amazon’s counterfeit problem is really bad with several news outlets calling them out. A Wall Street Journal investigation in August, for example, found more than 4,100 products on Amazon.com that federal agencies had declared unsafe. A Washington Post article last fall described a “flea market of fakes” on Amazon.com, saying its system was “failing to stanch the flow of dubious goods.”

CBx Vibe:Fake Love” Drake

CONTRIBUTOR

CultureBanx Team

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