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Amazon Says its $1.2B Anti-Counterfeiting Strategy Is Working

Long criticized for not doing enough to combat counterfeiting on its marketplace, Amazon says its seller vetting strategies and detection advancements are weeding out the bad actors.

In 2022, Amazon stopped more than 800,000 attempts to create new selling accounts—down from 2.5 million attempts it thwarted in 2021, and 6 million attempts in 2020, according to the company’s third annual Brand Protection report.

During the year, Amazon identified, seized and disposed of more 6 million counterfeit products, doubling the 3 million fake products they found and discarded in the year prior.

The brand protection efforts have been a monumental undertaking at Amazon, which invested more than $1.2 billion on the problem in 2022. Amazon employed more than 15,000 people as part of the investment to protect customers and sellers alike from counterfeit and fraud—including machine learning scientists, software developers and expert investigators.

“We are proud of the progress we made this past year, and we will continue to innovate until we drive the number of counterfeits in our store to zero,” said Dharmesh Mehta, vice president, worldwide selling partner services, Amazon, in a blog post. “We also appreciate the growing industry-wide partnership and collaboration in the fight against counterfeits. While the industry still has a long way to go in driving the right public and private sector partnership, we are excited about our progress and what we can do together to hold bad actors accountable and ensure the entire industry is rid of counterfeits.”

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Amazon has built tools to verify potential sellers’ identities by using a combination of advanced technology and expert human review. The company describes its risk-based models and processes for verifying potential sellers as “the first line of defense” for the e-commerce giant’s proactive controls.

Prospective sellers on Amazon are now required to provide a government-issued photo ID, taxpayer information and details about their identity, location, bank accounts, credit cards and more.

During the verification process, Amazon’s proprietary systems analyze hundreds of unique data points to detect and mitigate potential risk, including a seller’s relationship to previously identified bad actors.

Once the seller gets in the door, the tech titan will continuously monitor their store for potential infringement. From the moment a seller lists a product for sale, Amazon’s technology continually scans for potential counterfeit, fraud and abuse—including future changes submitted for the product.

When Amazon receives a valid notice of infringement or a customer complaint, the company’s machine learning algorithms use this information to learn, improving its proactive detections and scaling protections for brands.

Amazon’s automated technology scanned more than 8 billion daily attempted changes to product detail pages for signs of potential abuse.

Additionally, the company says its proactive controls found more than 99 percent of blocked or removed listings before a brand ever had to find and report them. These listings were suspected of being fraudulent, infringing, counterfeit or at risk of other forms of abuse.

While Amazon’s number of products available and sold have continued to grow, the number of valid notices of infringement submitted by brands has significantly decreased.

“We continued improving our automated protection technologies, which leverage our partnership with brands enrolled in Brand Registry and the data they provide us,” said Mehta. “This reduced the need for brands to find and report infringements. In 2022, adoption of our brand protection programs continued to grow—and, at the same time, the absolute number of valid notices of infringement filed by brands in Brand Registry decreased by over 35 percent.”

In the report, Amazon also touted its partnership with the United States Patent and Trademark Office (USPTO), noting that the office has allowed the company to identify more than 5,000 “false or otherwise abusive” brands and remove or prevent them from enrolling in Brand Registry.

Amazon has been able to team with brands, law enforcement, the U.S. Chamber of Commerce and U.S. Customs and Border Protection (CBP) alike in recent years in an effort to curb the bad actor, pursuing more than 1,300 criminals in the U.S., the U.K., the E.U. and China through litigation and criminal referrals.

The company is supporting law enforcement investigations by launching its Counterfeit Crimes Unit (CCU), a global team that includes former federal prosecutors, FBI agents, expert Investigators and data analysts. The CCU shares information with customs agencies and law enforcement alike to track down counterfeiters, shut down bad actors’ accounts, seize counterfeit inventory and prosecute those involved.

For example, Amazon shared information with several public security bureaus in China, which helped law enforcement raid counterfeiting operations across multiple provinces. During the raid, law enforcement officials seized more than 240,000 counterfeit items and dismantled three major counterfeiting networks, Amazon said.

CCU has gone after counterfeiters and their networks through civil suits, joint enforcement

actions and seizures with law enforcement worldwide, including against suppliers, logistics providers, social media influencers, fake reviewers, fake invoice providers and more.

The report highlighted Amazon’s expanded work with the CBP, and both parties’ ability to mutually exchange information. In 2022, Amazon provided leads to CBP about confirmed counterfeiters, and the agency provided information to Amazon that allowed the company to stop counterfeit goods destined for its fulfillment network and remove infringing listings from its marketplace.

Amazon said it is currently pursuing similar programs with customs agencies across the globe, including a memorandum of understanding with Japan Customs that is “already producing positive results.”

“We are encouraged to continue these partnerships with customs agencies to speed interventions around products, provide greater aid to law enforcement, and better protect customers,” the report said. “These partnerships prevent counterfeits from reaching Amazon customers and stop products from crossing borders and entering domestic supply chains so they are not sold through any retailer or store.”

Beyond the attempts to stop counterfeits, Amazon also is bringing awareness of the problem to the end consumer. The company teamed with the U.S. Chamber of Commerce and the CBP before the 2022 holiday season to build marketing campaigns that reached over 70 million consumers in the U.S.

The campaigns helped educate consumers about how to shop safely and ensure they were purchasing authentic products while understanding the harm and dangers of purchasing counterfeits.