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Comment by bonestamp2 | Hacker News Reader

Amazon isn't going to take this seriously until a major company gets burned and the FBI gets involved. Then Amazon will experience what every other company does that gets burned for selling counterfeit goods... the FBI will raid their warehouse and hold all the inventory as evidence until they complete their investigation. Like you said, Amazon doesn't seem concerned that they're selling counterfeit goods -- probably because they don't understand that's a serious crime.

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8 out of 10 people cannot spot counterfeit goods. I bought a major brand perfume, Sold and fulfilled by Amazon. When i used it after 2 months i was suspicious a. One day i was in Macy's, saw the same perfume (on same price). I tried the tester and i realized that perfume at home is a cheap knock off.

Initially i though that Amazon did not store it properly and warehouse heat must have destroyed the smell. Then i saw one star reviews. For last 6 months people were complaining and getting refund for this perfume. My refund windows was already closed. Anyway, lesson learned. Amazon is a hit or miss these days like eBay.

Here is one example, 84$ Magpul sights. If you have never seen the original product, you cannot spot the difference.

https://www.amazon.com/Magpul-MBUS-Front-Backup-Sight/produc...

edit: Added "Sold and fulfilled by Amazon"

That Magpul sights link is a great one. Many negative reviews that call out fakes, and name the sellers.

The reviews are from fall of last year, so plenty of time for Amazon to address the issue.

The sellers mentioned are still selling the sights. So, either they were selling fakes, and Amazon doesn't care. Or, they weren't, and it was a commingling issue, but Amazon hasn't fixed the reviews....Innocent parties are being blamed.

Has to be one or the other. Either way, Amazon isn't doing the right thing.

Never buy perfume from Amazon. It's one of the most commonly counterfeited items out there. Go only to the site of the manufacturer or an authorized retailer.

Not to mention grey market items, which are a commonplace in Amazon UK.

If you buy many items from Korea or Japan, expect to get some plain plastic bag without instructions or traces of original packaging.

When I followed your link it says:

Sold by MSP Sales LLC and Fulfilled by Amazon.

Amazon does not allow one to create a permanent link to a specific seller. You can only link to the ASIN, which will determines the seller to display on-demand.

Unless the product category or brand is "gated" (and to be fair, many are), meaning it requires pre-approval to list on Amazon, anyone can hitch onto any ASIN by telling Amazon they have that product in stock (if FBA, by sending in "that product").

I don't know about that particular product but Amazon's inventory can go in and out of stock. Also they do not give themselves the buy box all the time, they do share it with third party sellers.

It changes frequently. I tried the link this morning and it is "Sold by HandAProduct and Fulfilled by Amazon."

Amazon seems to be untouchable. They didn't even get in any trouble for selling illegal and prescription drugs but Bodybuilding.com did.

http://abcnews.go.com/Health/amazon-prescription-drug-proble...

http://www.slate.com/articles/health_and_science/medical_exa...

https://www.fda.gov/iceci/criminalinvestigations/ucm305494.h...

I hope Amazon doesn't become another HSBC case. Given the extent of the fraud, I'm already disappointed that the FBI doesn't seize a warehouse for investigation.

There is probably a calculation that the feds will be reticent to do that to an Amazon warehouse as they're generally major employers in the areas they're built in.

There was a great Bloomberg Decrypted podcast a couple weeks ago weighing the costs and benefits for a small town in offering a multi-million dollar subsidy for thousands of low-skill Amazon warehouse jobs. Is it really worth subsidizing at all when the government will have to fund various welfare programs to cover the difference between the ~$10.00/hr paid and a livable wage? But since towns compete and prestige is awarded to politicians who win deals, towns race each other to near zero expected value.

https://www.bloomberg.com/news/articles/2017-03-14/your-tax-...

But they already have to pay welfare for those people, right? Or is Amazon bringing new low income residents?

Exactly. It's $10/hr less that has to be covered than before. Plus the ware house drives local commercial traffic, workers have to eat, etc.

So they weren't eating before?

No the point is that even at $10/hour it's better than the same people not working at all.

Do you disagree?

The New York Times also did a big piece showing that these deals were almost always bad ones. The thing is that politicians have a simply ideological commitment to not intervene more directly.

The politicians do intervene directly

>cities compete to offer the biggest tax

So it would be actually better if they did less intervening, by not offering tax breaks to Amazon.

When I say "intervene directly" I mean more like directly employing people.

Makes me wonder if political deals to bring in military-industrial complex jobs at military bases and arms manufacturing plants and the like are any better. They at least provide better compensation to the workers, right?

Towns like to attract military bases because they bring in a large population that is employed requires no loca services (since it's handled by the armed forces), usually well behaved which spends its income locally. Bases also bring 100s of civilian jobs and support local businesses.

Yeah, but military Keynesianism also involves a lot of the taxpayer dollars lining the pockets of arms manufacturers and contributes to belligerent foreign policy. It's worth asking whether the same money could be used to employ people to do something other than building more F-35s.

You're thinking large-scale, not small-scale. Locally, building more F-35s is good for the local economy and keeps people employed, and the negative effects are minimal if any. Nationally, it's a different picture. Why would local politicians care about things on a national scale, rather than what's good in the short term for their little town where they're trying to get re-elected?

Military bases also pay no local taxes so they don't increase their tax revenue.

They pay certain taxes e.g sales taxes, they pay salaries to civilians that work on base and they do not really use any of the local services that are tax funded, police, fire department, medical and social services all provided by the DOD.

No, the federal government does not pay state or local sales tax. Bases also open and operate large sales tax free stores for service member and family use (base exchanges).

Military housing, as long as owned directly by the federal government, doesn't pay property taxes and the residents do use local police, fire dept, and schools as well as drive on local roads. Any local or state services are fully available to to them just as any other resident. I've also personally seen both local and state police respond to emergencies at the base.

Service members can also elect to file income taxes in the state they lived in when they were called to active duty rather than their duty station location.

I'm not saying military bases don't add to the local economy, they do, just not anything like a civilian operation of a similar size.

>Bases also open and operate large sales tax free stores for service member and family use (base exchanges).

Those aren't accessible to all the civilian workers and contractors who work on-base.

>Military housing, as long as owned directly by the federal government, doesn't pay property taxes

Civilian workers and contractors are not military, and don't use this housing. They live off-base, and pay property taxes and sales taxes. With the generous paychecks they get (relative to the locals who work at Walmart), they can afford to buy or build much larger houses and nicer cars, so they pay a LOT more in property taxes.

>I'm not saying military bases don't add to the local economy, they do, just not anything like a civilian operation of a similar size.

No, what you're really saying is that you have no clue at all what goes on on a military base, and you have some ignorant idea that everyone there is in the military when in fact it's usually a small minority of people on-base who are active-duty military.

It's certainly not the most efficient way to generate employment but these guys know where their bread is buttered.

Mother Jones did a major piece on this several years ago.

http://www.motherjones.com/politics/2012/02/mac-mcclelland-f...

I guess I'm curious how you came to the conclusion they're major employers where their warehouses are. As far as I can tell each warehouse is about 1,000 full-time jobs. If I look at a list of warehouse locations:

https://en.wikipedia.org/wiki/List_of_Amazon.com_locations

They're pretty much universally a rounding error for total population and jobs in their respective metro areas.

That's tens of millions of dollars in salaries injected into the local economy from one employer, not to mention the other additions like local taxes and utility spending. 1000 jobs is significant.

Wait, WHAT? The average Amazon warehouse worker makes $13/hr. That's ~$27,000/yr BEFORE taxes. In other words: any employee making that salary and actually trying to raise a family is collecting more from the government than they're paying in. They aren't contributing anything to the local economy, they're draining it just like Walmart.

How does an Amazon warehouse drain money from a local economy? Purchases at Wal-mart export your money outside of a local economy, but the presence of an Amazon warehouse doesn't really change the number of purchases you'll be making at Amazon in your town.

So we wait until 990 of those jobs are lost to automation ... then we order pitchforks from Amazon ?

Then Amazon can locate its facilities even farther from population centers where there is no municipal or even county government to speak of.

1,000 full time employees is pretty big these days. The highly touted Carrier deal amounted to maybe 700 jobs. Elizabeth Warren made an announcement about the big new Amazon distribution center in Fall River. It's supposedly Amazon's biggest, and I recall it was about 1,000 jobs. So they are doing more with the same headcount.

1,000 jobs is about what the American economy creates every two hours. Politicians tout these deals because they know that most voters are clueless about the magnitudes involved.

You can't directly compare 1000 jobs in the entirety of the US and 1000 jobs in a small town with nothing else going on.

I can when national-level politicians are devoting time to them and then bragging about it.

That's true but my point was that jobs are no longer created in fleets of tens of thousands at one throw. Even the largest distribution facility of the world's eighth largest retailer has 1,000 jobs in a facility that probably operates two or three shifts weekdays and weekends. That's a very lean crew on each shift.

It's about name recognition, not job count. Amazon is seen as a cutting edge, high-tech employer. It looks goods when politicians say "Welcoming $COOL_COMPANY_X into our area!", it helps people feel important. It doesn't really matter whether they're bring 50 jobs or 5000; what matters is people can say "Yeah, Amazon is just up the street".

Fall River is also extremely economically depressed. I thought that was a typical case but the list of locations suggests maybe that's not entirely true.

Pretty smart on Amazon's part. Locate in depressed areas: the work doesn't require any real skills, the wages, working hours and conditions can be poor because there's no other real competition for employment, and dispite all that the local politicans love you for being an improvement on what they had before.

It's a tried and true formula.

Massachusetts isn't as big a boomtown as some areas, but population grew about 4% in a region better known for losing population. Fall River isn't as much a backwater as it used to be.

Do you mean Fall River? I'm certainly not arguing that Massachusetts, as a whole, is economically depressed.

Fall River may get commuter rail. Then cheap rents will be over there and in New Bedford, which are both on the ocean. To get really economically depressed areas, you have to go to Springfield, which is still our meth lab capital.

The whole state is a backwater. The part inside 495 just happens to be dying more slowly because they've got higher education medical and some tech industry.

Hopefully you're right (for the employee's sake). But given the Bezos/Trump feud, if I were Bezos I'd be very cautious about giving the feds any valid reason (with lots of precedence) to shut down any warehouses for an investigation.

That's why this is done by the Feds rather than local cops. They don't have to care about local employment.

I am sure that other significant business losses will also cause Amazon to take action, like understanding how many sales they're losing for lack of trust. So I ask everybody reading this: next time you get ripped off, make sure your contact understands that you aren't just returning the product, you are re-purchasing it elsewhere because you can no longer trust Amazon with this.

As someone else here pointed out, most people don't realize they're getting counterfeit items.

Anecdotally, most of the people I've spoken to regarding this haven't even considered that something they get from Amazon might be counterfeit. Many don't really understand the 3rd-party seller system, Fulfilled by Amazon, etc.

You think Amazon is clueless? They're not. They know they're shipping counterfeits. They've done the math, and it's making them money.

I don't think we'll see a significant change unless there's a lot more bad publicity, or the government gets involved.

>until a major company gets burned and the FBI gets involved.

Or until consumers start to become unsure enough about whether they are getting legit goods on Amazon that they become wary of shopping there.

>they don't understand that's a serious crime.

Oh, they understand this well. They are a multi-billion dollar company with teams of lawyers.

But, as long as they can get away with a passive response--like processing refunds when requested--without taking too much of a reputational or legal hit, they will continue to do so. Effectively, it's cheaper to outsource the policing to customers vs. trying to vet vendors at scale.

> hold all the inventory as evidence

With the FBA situation, why would amazon even care?

Amazon will just tell the seller, "X from your inventory was just sized by the FBI, talk to them if you want it back"

The seller has no leverage against Amazon, Amazon is out no money, Amazon will just get another shipment of counterfeit widgets the next day.

> Amazon will just tell the seller, "X from your inventory was just sized by the FBI, talk to them if you want it back"

No, if you have FBA, once your item enters their system, it's their item. If it's seized by the FBI, AMZ will pay you fair market price for your item they've lost the possession of, or will replace it with a likewise item.

I mean, if they had any actual idea/proof that you're the one who supplied them with the counterfeit, they'd not put it into their space in the first place; once it's on the shelves, it's all shared property, and sellers don't own any individual stock.

What is the fair market price of perfume that has been identified as counterfeit by the FBI?

Yeah, just because they pay you for inventory they lose doesn't mean they pay you for inventory that was seized for being counterfeit.

Amazon might care when entire warehouses are locked down for investigation. It's systemic after all.

I find it unlikely to believe that they would lock down entire warehouses for any significant period. I think this is the equivalent of shutting down an entire port because of a (or a few) containers of cargo are counterfit.

...That sounds like the FBI we know and "love". They do so love to make a point.

Amazon is a powerful company with friends in high places.

Don't forget about enemies in even higher places.

I believe FBA stock is comingled with other FBA and Amazon.com stock for the same SKU in the warehouse.

Then how would they know when to credit a seller for a sale? I believe the seller doesn't receive the money until someone actually buys it.

Amazon credits you when someone buys your item, but the item Amazon ships the buyer might not be yours, but an equal equivalent.

And, before you ask: Yes, this results in situations where 100% legitimate sellers on Amazon can sometimes ship (via Amazon/FBA) their buyers counterfeit goods. Shitty situation to be in as a seller.

Sellers can opt-out of commingling, but many don't because a) they don't understand the implications, as Amazon doesn't really make it clear; and b) because it requires them to individually add a separate sticker/identifier to each unit of their product, adding significantly to preparation and packaging costs.

I think Amazon charges more for storage fees if you disable commingling too.

I'd imagine fulfillment would be pricier, too, since items could no longer be located at every warehouse at no extra effort.

Not correct. They do however make you pay for a tier above their "small and light" for handling.

Not true; depends on whether or not you use comingled inventory. It's easy to make it not comingled. That's what we do.

>Then Amazon will experience what every other company does that gets burned for selling counterfeit goods... the FBI will raid their warehouse and hold all the inventory as evidence until they complete their investigation

You'd be surprised what being a big company can do to protect you from such actions by the FBI.

From my experience working at Amazon, they do take it very seriously. They've got multiple teams working on automated detection of counterfeit using rules, machine learning, etc., and hundreds of investigators looking into cases.

They allow return of counterfeit and will reimburse you fully, and they'll have the item return to them for inspection.

If they know you've frauded before, they try and block you from the platform by fingerprinting you and your accounts.

The issue is that there's too many sellers and too many product, it's a really hard problem to solve. Counterfeit has improved considerably too, sometimes it even comes from the same factory, they call it the "night shift".

And while we try to prevent it, we also have to balance out false positive rates, not to hurt the seller's buisness without real cause.

I'm afraid most websites will suffer from this, if you want to be sure, try to buy straight from the manufacturer, but even then, make sure you double check the website, not all manufacturers sell directly and online, so that could also be fraud.

It's not hard to solve.

It's hard to solve under Amazons business model whilst retaining Amazons profit margins.

It's a problem they chose to ignore for a long time because they could.

I think Apple sued them recently about counterfeit chargers. Let's see if that will do anything.

interestingly I almost got a counterfeit yesterday. I bailed at the last second when I saw there were many sellers shadowing the manufacturer and reading the comments that one guy got an unbranded version of the good, so I went to the manufacturer website itself and bought from there.

while amazon will not see the individual user receiving counterfeits, it will feel the bottom line slowing down, rest assured.

edit to add: if I wanted counterfeit goods, I'd go to aliexpress and at least save a buck.

"the FBI will raid their warehouse and hold all the inventory as evidence until they complete their investigation"

Considering the strained relationship between Bezos and Trump, I can actually see that happening.

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