How is this at all legal?
eta: As a non-US person, I honestly find this incomprehensible. If you've taken the customers' money and the goods have been supplied, then the middleman hanging on to that money is called theft in most parts of the world.
(well, the underlying problem is that the US takes an extremely caveat emptor attitude to consumer protection and almost everyone in politics would rather play high stakes culture war issues than deal with boring stuff like making sure that corps can't rip people off)
They say that the seller should check their other product listings and get rid of any others that violate policy. It's if the seller doesn't do that that Amazon says they might permanently hold the seller's funds.
As in steal the money that customers paid for products that were delivered?
Wonder if the customer can then just challenge this in a small claims court as a European (if your country has something like this.)
It's probably legal in that Amazon's seller terms already specify they can hold the money from any purchase for up to N days (say, net 30) and that they can suspend seller accounts for certain reasons. So they will have already paid the seller for orders more than 30 days in the past and the rest they can hold.
...for 30 days. Is what any reasonable human would assume.
You can still make a bank transfer to someone even though you banned them from your own platform.