Agreed. It's most likely a sin of omission, creating a broken system because it's not in their interests to fix the general counterfeiting problem.

There may be ancillary benefits, like increased seller competition into their monopsony, but it's not a priority for them to fix, because apparently it doesn't affect their bottom line enough.

It's not like it's hard to come up with a solution to the problem - they have lots of ways of surfacing prime-eligible items, you could have a similar way of surfacing manufacturer-approved resellers for some items. And as others have mentioned, there are no counterfeit kindles on amazon.com