Internal information from Amazon is making its way to messaging apps such as Telegram, where brokers are supplying data to external vendors. In this case, brokers are acting as intermediaries between sellers and Amazon staff, who are leaking the data in return for a financial benefit. In a Telegram group, a message stated: "We are offering screenshots with insider knowledge as viewed by seller support – get even more knowledge about your account by ordering these from us."
Millions of sellers working in the flourishing Amazon marketplace often worry about the possibility of account suspension after being accused of misconduct, a situation that can cause their business to collapse immediately. Resuming operations requires either a confession of guilt and a subsequent correction of the issue, or sufficient evidence of innocence - both of which are processes that can be both lengthy and costly. Enter the illicit brokers. Through services like "Amazon Magic" (offered on end-to-end encrypted messaging services like Telegram at rates of $200-$400) sellers are able to purchase information on competitor activities and have negative reviews on their product deleted - all for a fee. It is estimated that over 13,000 members are in these Telegram groups alone; not to mention the traders offering such services through WeChat, WhatsApp, and Facebook Groups. For many third-party marketplace sellers on Amazon, Etsy, and Walmart, the data these brokers provide is invaluable in regaining their product or account status. As Amazon's marketplace now represents more than 60% of sales made on their platform, these services have become a multi-million dollar industry.
The surge in counterfeiting and spamming on the global marketplace has led Amazon to increase its enforcement measures. However, much of the fraudulent behavior takes place on social media and encrypted messaging apps, which makes it difficult to police. A public Facebook page provides access to internal screenshots, allowing users to see how Amazon employees view their accounts. Neither Meta (Facebook's parent company) nor Amazon provided comment on the matter. It is not uncommon for Amazon to have to tackle bribes from lower-level, low-wage seller support staffers based out of China, India, and Costa Rica. Brokers are known to reach out to insiders on LinkedIn to gain access to Amazon's confidential data. Amazon has an internal team that is dedicated to investigating potential breaches and monitors social media for abusive groups. The spokesperson for Amazon said the company pursues all measures to protect its store and holds bad actors accountable. They have zero tolerance for staffers that violate their policies, although they did not give details on if any employees have been disciplined or fired.
Amazon faced allegations in 2018 that some of its employees in China were receiving payments ranging from $80 to $2,000 to share confidential sales information or delete bad reviews, according to The Wall Street Journal. The US Department of Justice subsequently charged six people in 2020 for taking part in a bribery scheme involving Amazon employees and contractors, one of whom was sentenced to probation and house arrest in March this year after pleading guilty. An Amazon staff member's account annotations, as well as internal notes, were among the confidential data exchanged. But the company had "robust systems" in place to detect and report suspicious behaviour, such as fraud and abuse. It has also asked social media companies to help it detect and eliminate fake reviews.However, despite Amazon's efforts to tackle the issue, numerous groups continue to emerge on encrypted chat apps such as Telegram, WeChat and WhatsApp, according to a person with knowledge of the matter. One of these groups, named Amazon Magic, is public and users regularly offer black hat services, including screenshots of Amazon's internal Paragon system used by seller support personnel to manage cases. CNBC verified the legitimacy of the screenshots with sources familiar with the system. Messages in the group are mainly in Russian and the individual running it is reportedly based in Ukraine. Nevertheless, no response was received to a request for comment.
Group administrators present a full range of services on an online spreadsheet. Annotations, which usually contain more information than suspension warnings, cost $180 each, and varying prices apply to attacks on competing entries. A tactic used to control the trustworthiness or popularity of a product, securing an upvote on a review, costs 50 cents. The brokers guarantee buyers that they can provide the goods within one to two business days.
For a long time, Amazon vendors have expressed their dissatisfaction about being removed from the site with no explanation. The process of regaining the account may take months, leading to major losses in sales. This matter was the focus of the House Antitrust Subcommittee investigation into Amazon and other Big Tech firms' competitive practices, which lasted for 16 months.
"When Amazon turns off the tap, everything falls apart," remarked Cynthia Stine, president of eGrowth Partners, a consultancy that aids retailers in getting reinstated. "I've had CEOs of large companies cry on the phone to me, and had to fire their people. They've even declared bankruptcy."
Annotations are like an "insurance policy" for suspended sellers, Stine declared. She said she often encounters potential clients who have acquired annotations and are trying to regain their selling privileges, usually once or twice a month. The rise in black hat brokers and consultants has had a negative effect on her business, Stine said.
"For some time, people would not even come to us; they would simply deal with whoever they bought the data from," she added.
Amazon previously claimed they have systems in place to assist merchants in avoiding deactivation and getting their rights back if suitable. The company refuted allegations that the chaotic and pricey suspension process justifies unlawful activities such as acquiring confidential data.
"There is no place for fraud at Amazon and no reason to resort to illegal activities," an Amazon spokesperson told CNBC last month.
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