The government charged six people including a prominent Amazon expert and consultant with conspiracy and wire fraud as part of a scheme to bribe Amazon employees in order to get third-party sellers' accounts reinstated, among other things.
The intrigue allegedly included a suitcase full of cash sent from one defendant to another, through Uber.
The Feds say Amazon insiders involved in the scheme deleted negative product reviews from product listings and tried to trick Amazon's review-ranking algorithm into believing fraudulent product reviews had been posted by bona fide purchasers.
It also charges the defendants with causing fictitious negative product reviews to appear "frequently and prominently" in victim 3P sellers' product listings. According to the indictment:
"It was part of the conspiracy that the Defendants, and others known and unknown to the Grand Jury, used bribes, the promise of bribes, misappropriated information from Amazon's protected computer network, and materially false statements, representations, and omissions, to attack 3P seller accounts and their product listings, to gain a competitive advantage and to settle scores."
In one incident alleged by the government, Amazon insiders offered to provide a "Jeff B Final Word reinstatement" to the consultants' client for $5,500 with one of the defendants suggested tacking on an additional $1,000 for themselves.
"Jeff B" stands for Amazon founder and CEO Jeff Bezos to whom some desperate sellers email with pleas for assistance, and who famously reads emails
The government alleges that one client paid defendants $200,000 in exchange for a successful account reinstatement.
When one client failed to pay their bill, defendants allegedly defaced the client's seller page with vulgar images, "effectively incapacitating it on the Amazon Marketplace."
The government wrote that in the course of the conspiracy described in the Indictment, the defendants paid bribes to at least ten different Amazon employees and contractors, including one who had been a seller-support associate in Hyderabad, India, before becoming an outside consultant who recruited and paid bribes to his former colleagues.
Among those indicted was Ephraim Rosenberg, aka Ed Rosenberg, who "purports to provide fee-based consulting expertise to 3P sellers, including through a service named "Amazon Sellers Group TG."
"In addition to providing individualized consulting to 3P sellers, Rosenberg hosts an annual 3P seller conference in Brooklyn, provides informational digital videos about 3P sales through an account on the video-sharing website www.youtube.com, and hosts interactive 3P consulting webinars."
Rosenberg, founder of the Amazon Sellers Group (ASGTG), whom EcommerceBytes has quoted and linked to in previous articles, posted the following on LinkedIn
"I am aware of this charge and I am dealing with this situation so cannot comment but totally will when I can. In the meantime please join the group https://lnkd.in/dzqRvgH Thank you for the many messages of support."
He also posted a similar message on the ASGTG Facebook page
. He did not respond to our inquiry.
The charges go beyond reinstatement and review manipulation The prosecutors wrote of "corrupted employees and contractors" on the Department of Justice website:
"In exchange for bribes, they increased 3P sellers' storage limits in Amazon's warehouses, facilitated 3P sellers' otherwise meritless requests to sell products in restricted categories, and provided 3P sellers with inside knowledge about the most successful advertising campaigns and most profitable product listings."
Readers should note that an indictment is only an allegation of criminal conduct, and all of the defendants are presumed innocent until and unless proven guilty in a court of law beyond a reasonable doubt.
Cynthia Stine of eGrowth Partners welcomed the news, telling EcommerceBytes the actions of bad actors gave some sellers an unfair advantage.
Stine also helps merchants get their Amazon accounts reinstated but says she does it by helping sellers do what Amazon asks and helping them write a thorough appeal. She also focuses on suspension prevention, she said.
Patience is key - Amazon may take weeks to respond to sellers, and there is no accountability, she said. The desperation that results from Amazon's slow response is what drives some sellers to hire consultants who promise quick results. Stine said to be wary of any service that guarantees a reinstatement, especially those promising a 24-hour turnaround.
The indictment shows sellers are vulnerable when using a third-party service to act on their behalf, but Stine said she was not nervous that today's news would scare sellers from using her service. She said she's been speaking out against bad actors for the past 2 years - "not by name, but by tactic," she told EcommerceBytes.
"It's really good news for Amazon sellers and consumers," she said, claiming that counterfeiters and money launderers were among those employing consultants who use shady tactics.
Helping sellers is a cottage industry - a search for "Amazon plan of action" or "Amazon reinstatement" results in advertisements for numerous services promising to help suspended sellers.
Note: Not every defendant is being accused of every alleged act.