Amazon ready to spend billions combating counterfeit merchandise

Amazon is prepared to invest billions of dollars to keep business customers from selling fake or dangerous products on its platform, according to the executive in charge of the e-commerce giant’s consumer wing.

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“We have to be vigilant and willing to spend hundreds of millions and eventually billions of dollars to protect our customers,” Amazon Worldwide Consumer CEO Jeff Wilke said at the WSJ Tech Live conference on Tuesday.

While Amazon has policies banning the sale of counterfeit goods and setting guidelines for potentially dangerous items, the company has faced repeated accusations that it fails to do enough to keep them from reaching customers.

A recent Wall Street Journal analysis found that Amazon had more than 4,000 items for sale that were mislabeled or declared unsafe under federal guidelines. More than half have since been taken off.

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Earlier this month, the American Apparel & Footwear Association, a fashion trade group, recommended that the U.S. Trade Representative add several of Amazon’s international marketplaces to its list of “notorious markets” for counterfeit goods.

Amazon responded with its own letter to the USTR, arguing that the trade group's recommendation "does not reflect the efforts that Amazon has already undertaken" to address counterfeit goods.

"Contrary to the suggestion in AAFA's submission, these efforts are working, as over 99.9% of the products that customers actually view in Amazon's stores never have received a complaint about a suspected counterfeit from a customer or rights owner," Amazon vice president of public policy Brian Huseman said in the letter.

Amazon has invested $400 million in technology to block counterfeit and dangerous goods, Wilke said. The Seattle-based company is enacting countermeasures amid unprecedented scrutiny of its business practices; it's one of several tech giants currently under review by federal antitrust officials.

Sen. Elizabeth Warren, the Massachusetts Democrat seeking her party's nomination to run for president in 2020, has proposed that the federal government break up Amazon and other large companies engaging in what she describes as anti-competitive business practices.

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The European Commission, whose duties include enforcing the trading bloc's antitrust regulations, said last July that it was beginning a formal investigation into Amazon’s role as both a direct-to-consumer retailer and operator of a third-party marketplace. Critics say the company is essentially competing against its own customers..

Amazon associate general counsel Nate Sutton told a House antitrust panel that month that the company does not have a monopoly among U.S. retailers. He argued that Amazon’s sales composed just 4 percent of the overall U.S. retail market.

This story has been updated.