Amazon, Alibaba team with Homeland Security to prevent COVID-19 fraud

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Amazon, Alibaba team with Homeland Security to prevent COVID-19 fraud

By Dan Berthiaume - 05/06/2020

The world’s two biggest e-tailers are cooperating with a new partner in response to pandemic-related e-commerce crime.

Amazon and Alibaba are working with Homeland Security Investigations (HSI) National Intellectual Property Rights Coordination Center (IPR Center) criminal investigators in a new public-private partnership to combat fraud and other illegal activity surrounding COVID-19.

Since the start of the pandemic, HSI and other law enforcement agencies say they have seen a significant increase in criminals attempting to profit from the COVID-19 pandemic, including the sale of counterfeit pharmaceuticals and medical equipment, as well as illicit online sales and trade importation violations of products claiming to be treatment options.

In April, HSI launched Operation Stolen Promise, a component of U.S. Immigration and Customs Enforcement (ICE) and the largest investigative arm of the Department of Homeland Security, to prevent and investigate illegal criminal activity surrounding the pandemic. 

As of May 4, HSI special agents have opened over 315 investigations nationwide; seized over $3.2 million dollars in illicit proceeds; made 11 arrests; executed 21 search warrants; analyzed over 19,000 COVID-19 domain names; and worked alongside U.S. Customs and Border Protection officials to seize 494 shipments of mislabeled, fraudulent, unauthorized or prohibited COVID-19 test kits, treatment kits, homeopathic remedies, purported anti-viral products and personal protective equipment (PPE). 

“Since the beginning of the COVID-19 crisis, Amazon has proactively stopped more than 6.5 million products with inaccurate claims, removed over 1 million offers for suspected price gouging, suspended more than 10,000 selling accounts for suspected price gouging and referred the most egregious offenders to federal and state law enforcement across the country,” said Dharmesh Mehta, Amazon VP, customer trust and partner support. “Amazon welcomes HSI’s partnership in holding counterfeiters and bad actors accountable, and we look forward to building on our long-standing relationship to protect customers and ensure a trusted shopping experience,” 

“Consumer health and safety is Alibaba's top priority. We will continue to enforce a zero-tolerance policy against those engaged in illicit activity, especially with respect to products and services related to COVID-19,” said Michael Evans, president of Alibaba Group. “We are proud to be part of this important collaboration and value our long-standing partnership with the Department of Homeland Security.”

Amazon has been facing increased scrutiny of fraudulent and unethical activities conducted by third-party Marketplace sellers, including pandemic-related price gouging and customer injuries resulting from faulty products. The retailer is also reportedly expanding a pilot it launched in February 2020 to conduct video interviews of prospective third-party sellers on Amazon Marketplace to help prevent fraudulent sellers from creating multiple accounts.