Are You Accidentally Committing Fraud on Amazon?

Chris: [00:00:00] Hey everybody. Welcome back to Seller Performance Solutions. Chris McCabe and Leah McHugh, both of ecommerceChris, here discussing the upcoming Amazon Seller Growth Summit in New York for the first time. It’s kind of like a mini Amazon Accelerate. Instead of couple thousand people, it’s I think more like 500, 600.

But they’re doing it in New York, which is exciting because it means it’s just down the road for us, and it’ll be easier to get to than flying to Seattle. But also we want to kind of see, is Seller Cafe the same? Are the speakers the same? Are they one-on-one, face-to-face interactions, which so many people value at Accelerate, are they gonna be the same in New York?

So we’ll have a nice little podcast or video after the event is over. But for now, I want to talk about what we’re planning to talk to people about this week. I’m sorry, next week, not this week. It’s July 16th in New York. I believe they still have tickets.

So there should be… We’ll include it in the show notes. It’s one day. It’s not the three days of Accelerate. It’s July 16th in Midtown Manhattan. So we’ll include that [00:01:00] info down below, but, time’s a-wastin’. I want to focus on what we’re gonna talk to people about because we have seen compliance investigations heating up.

I will let you speak to the big picture stuff, but my impression is that people are getting flagged for having unsubstantiated health claims, kill claims, so forth, either on their ASIN detail page or on their packaging. And then this happened even right before Prime Day, people got flagged and sometimes removed for having manipulated or edited images to show that they didn’t have non-compliant language on their packaging.

Is that a fair summary?

Leah: And that’s something that I’ve been seeing a lot more of, which I guess makes sense now that AI image creation is more broadly available to people.

Chris: Yeah.

Leah: But have been having a lot more people contacting us saying that they get flagged for having something on their packaging that they’re not allowed to say or not having something on their packaging that’s legally required.

And their way of addressing that was [00:02:00] photoshopping fake packaging that meets the requirements and then submitting that to Amazon.

Chris: Yeah.

Leah: And so that’s fraud.

Chris: It’s bad. It’s not the way to go.

Leah: And I get- that a lot of people think that Amazon is just giving them a hard time about something, but for that sort of violation Those are legal requirements.

Amazon is enforcing legal requirements for those specific products.

Whether it’s a product that claims to kill pests but does not meet pesticide requirements, or it’s a supplement that is making disease claims that it’s not allowed to make. They’re not flagging it just because they don’t want that on the marketplace.

They’re flagging it because it’s not meeting the regulatory requirements for that product in whatever country it’s being- Yeah … listed in. And so submitting fake photos of compliant packaging is fraud, and if they catch you doing that, you don’t just lose the ASIN, you potentially lose your entire account because you’ll be flagged for evasive [00:03:00] behavior.

Chris: I was gonna jump in, and I didn’t wanna interrupt your flow, but I wanted to just cut you off really quickly because we’re now starting to see all the people that were sort of fudging stuff through the Prime Day period. Blowback is rolling in now in terms of people are starting to get flagged and suspended for evasive behavior.

And evasive behavior is a suspension where they’re supposed to only accept an appeal that disputes it, where you prove that there was- Well- … no evasive behavior …

Leah: so you not only have to prove that there was no evasive behavior, you also have to prove that the product that they think you committed evasive behavior for was fully compliant in the first place.

Chris: Right.

Leah: So there is no, “Sorry, we made a mistake.” It’s, “This product was always compliant “and we committed zero evasive behavior here.” So if the product wasn’t compliant and you faked photos of the packaging, there is really no viable path because you can’t dispute that you did exactly what they think that you did.

which

Chris: is why people are suspended now.

Leah: Unless you double down by committing more [00:04:00] fraud which I don’t recommend.

Chris: Well, there’s no double down. It’s just those people are starting to come to us now saying, “Remember that time we had that conversation about the images being altered and you said you couldn’t help us?

Well, we went ahead with that and now our whole account is gone.” And that’s what this week and last week, for anyone who cares what I did July 4th weekend, \\ the handful of you out there, I was having conversations about things like this because it was seven, eight, nine days after Prime Day and they were still full account suspension.

Again, not just ASIN level.

Leah: I have actually been seeing a lot more of these, and like I said, I think it is because it is a lot easier for people in general- Yes … to fake images. But not just images. I also have been hearing a lot more with faked documentation, and it’s the same thing. If they catch you faking documentation or altering documentation using AI or Photoshop or whatever it is, that will take down your entire account.

Chris: Yeah. I’m glad you mentioned AI. Yeah, don’t do it. I’m glad you mentioned AI because a lot of people– Well, okay, just to put a pin in that previous discussion, I know it’s painful to [00:05:00] pull inventory that’s not compliant you’ve already paid to ship it in. It costs a lot to pull it out.

An account suspension’s a lot more painful. So I, I understand- Yeah. And also-

Leah: to be clear, they don’t have to go to a warehouse to see what your packaging had on it.

Chris: Yeah.

Leah: They can see in their tools the previous these images on your listing.

Chris: Amazon-

Leah: It’s not like just by replacing the images, Amazon can’t see what was there before.

Chris: Yeah.

Leah: They can absolutely see what was already there and they can see that what you’ve done.

Chris: Yeah. I mean, if we keep going with that, the whole podcast will be on that one topic- … which I don’t want. But they’ve gotten a lot better at the BIN checks, and your competitors have gotten a lot better at requesting BIN checks.

Leah: And your competitors can also buy your product.

Chris: They can buy your product. I think people just got used to getting away with some of the stuff, and you can’t get away with it anymore. And the same goes with AI written escalations and appeals and spammy stuff with AI, because Amazon has gotten better at figuring out who’s sending them rewritten or [00:06:00] generic AI appeals.

And I’ve complained about this earlier this year, but one topic I plan to talk to anyone in New York who wants to talk about AI with me is stop sending this stuff in escalations. Like, if you wanna do it with seller support or you’ve got a generic appeal that you wanna send through Seller Central and you don’t expect it to work anyway, do it till the cows come home.

That’s fine.

Leah: Well, why would you send it if you don’t expect it to work anyway?

Chris: Because people send stuff they don’t expect to work all the time, and they admit that to me, which is crazy in and of itself. But anyway- that’s not my overall point. I am getting progressively more shocked, alarmed, and dismayed, and discouraged that people are sending things to executives all over the company, all over Amazon.

Sometimes it’s Amazon Legal, sometimes it’s Amazon Marketplace management types, whoever. Partner experience, communities teams. They’re using generic AI. I can tell within moments it’s AI,

Leah: and we don’t need to use software to detect it.

Chris: My point [00:07:00] is they don’t need software to detect it because they’re getting it from all of you or some of you, and they have readily identified, for all I know, they know which ones are Gemini, which ones are Claude, which ones are ChatGPT, which ones are whatever, because they see so much of this stuff. You’re just grabbing a shovel and digging your own grave.

You’ve gotta stop doing that. You’re turning these people off. If anyone really has a good use case, when I’m in New York next week, I will approach some of these people and say This is my theory, this is what I’m seeing. Are you seeing the same stuff? Is this true?” And see if they confirm it. But my impression, based on everything, all available evidence, is that they are tossing the stuff in the trash the second they see it.

They think that you care so little about your brand, so little about your account, that you’re too disinterested in writing something real, and you’re just regurgitating someone else’s AI, your AI, an AI based on an email, so on and so on and so on.

Leah: I think that’s the bigger problem, is that a lot of this seems to [00:08:00] just be being submitted without review.

So AI-generated content will have things that don’t really say anything, things that don’t even really make sense, or will reference things that don’t exist. So it’s not only showing, like, “Hey, I wrote this with AI,” it’s also showing, “I didn’t even really care enough to proofread this and check that it was accurate before I sent it to you.”

Well- So why would they take that seriously?

Chris: It’s just guaranteed failure. I know when we were in Vegas for the Prosper Show, we talked to one person who said, “Oh, we…” In a group who manages, a group of sellers, and they said, “We had a group member, who said that they did a high-level escalation, something more nuanced and complex, not just binary ones and zeros straightforward, and they got AI-written escalations to work.”

And ever since March, I’ve been trying to track down information on that one use case we’ve heard about, and I haven’t heard back or seen any evidence.

Leah: So here’s the thing- So- … ’cause I’ve also gotten pushback on this. AI in and of itself is not the [00:09:00] problem. You can use- Of course … a tool if you’re trying to put this together and you, and you want help with the structuring, and you want help to make it a stronger-looking argument.

Yeah. I’m not saying you can’t use AI, and I think people think that we’re just anti-AI. It’s a tool, but you can’t just shove something into AI, assume that it’s going to be correct- and then submit that. And a lot of the times that people are using AI, they don’t even fully understand the reasons behind the suspension or the information that Amazon is asking for.

So if you can’t even input that information accurately, how are you expecting AI to spit out something that’s going to move the needle? If you need to use it as a tool, maybe, like, your English just isn’t so good, AI is fantastic for translations. Write it in your native tongue and then have it translated into English.

Absolutely fine. But just relying on AI to be like, “Hey, write me an appeal”- It’s gonna be generic, it’s probably not gonna make sense, and it’s also going to be very long.

Chris: It’s too long, there’s a lot of filler, there’s a lot of [00:10:00] repetitive content that no one’s taken the time to edit out. It would take probably just a few minutes-

Leah: And

Chris: it’s gonna be very obviously written by AI

Right. It’s gonna be… If they see fluff, this goes, hearkens back to the days of the plan of action process. When they detected fluff, they’d stop reading, right? Well- And a lot of people led with the fluff.

Leah: Well, we’ve had people sending us summaries of their situation, and it’s this 10 page document, and I read through the whole thing and I’m like, “This didn’t say anything.” Like, I have read this entire thing and It’s making an argument, but it’s making an argument about nothing.

Chris: Right. I mean, back in college we used to call this the Golden Shovel Award for like, I’m gonna write a five-page paper and four pages of it- Oh, exactly

isn’t going to say anything. It’s the same concept. Do you think my professors went through, you know, were the types of people that were gonna read four pages of fluff? No, of course not. They were gonna kick it over to the teacher’s assistant and say, “Tell them to do it again,” or whatever the modern version of that is, since this is ancient history what I’m talking about.

What I’ve started, for all the people that think we’re anti-AI, and I’m sure the more I talk about [00:11:00] this we’re gonna get more accusations of that, I tell people very simply and elegantly, “It is a tool, it is not a crutch.” That’s my one-liner.

And I’ll say, “You are in the crutch bucket.

You are using it as a crutch.” And the people that we’ve been talking to, especially the ones who we know that they don’t know what’s going on because we get on calls and we email them, and we already know that they don’t even understand the core issue. So how are they gonna craft an appeal if they don’t even understand the core issue?

Leah: Right. Well, I think I’ve mentioned before on the show-

somebody cited a regulation to me once recently. And I was like, “I’ve never heard of that. Let me look it up.” It didn’t exist. AI made it up- Yeah … to answer their question.

So you don’t wanna be submitting made-up laws to executives at Amazon.

Chris: No. No. So

Leah: .. Don’t use AI blindly, and don’t use AI to commit fraud.

Chris: I, I think Amazon, once they get kind of up to cruising altitude on some of the AI tools, and once they [00:12:00] realize how much AI is being thrown at them, they’re gonna start saying something more specific. They’ll change the messages, the outbound messages that say more than just, “You haven’t provided us sufficient information,” which is the opaque, generic stuff they say now.

They’re going to eventually weave in a sentence that says like, “We can tell that this wasn’t reviewed properly. Go back and review it again and then we’ll consider your appeal.”

Leah: So- I mean, the irony of all of this is that Amazon is using more and more AI on their side.

Chris: Yes. But… Amazon-

Leah: Don’t do what Amazon does.

Do what we tell you.

Chris: Amazon is a do as I say, not as I do marketplace. And it’s a parent-child relationship. Like, do as I say, not as I do. Not that I’ve had children, but I’ve been a kid, and I remember hearing that, so. I mean, this is going to be a hot topic because AI’s always a hot topic.

We’re gonna talk to people about compliance and about AI appeals, of course. What I wanted to finish with today is- Understanding the code of conduct and understanding what abuse is and understanding that if you’re being [00:13:00] attacked and if you are reporting abuse to Amazon, make sure you’re not guilty of violating these policies yourself.

The example I want– You’re gonna have an example I know hot off the press, but I just want to bring up the if you’re buying from somebody who’s selling a counterfeit version of your product, do not leave them a one-star review because technically, I’m not saying I agree with this, technically that’s considered, a breach of one seller harming another, the code of conduct, and you’re just supposed to report it through accepted protocols and channels.

I understand it’s tempting to leave them a crappy review. You can’t do it as a seller within their category. We see people making this mistake a lot. So if you’re guilty of this, just go delete the review. Hopefully Amazon hasn’t seen it yet. I understand it sucks that you have to keep reporting abuse and that Amazon doesn’t do a better job themselves at identifying it before you report it, but the universe we inhabit right now is that it’s report-driven.

That’s why so many, so many, so many people are hiring us for abuse reporting. One last [00:14:00] point before I hand it over to you, which is a lot of people are marketing abuse reporting services that are leading to potential brand registry re- revocations because they’re over-accusing without enough evidence or just making false allegations or just being overly aggressive or spamming the queues, sometimes brand registry, sometimes email queues, sometimes other ways.

Carefully consider how you report abuse. I’m not saying have us do it every time. You might be able to do it yourself without hiring anyone. Carefully consider your evidence, your facts, the factual basis of it, what you can document, and how you report it. That’s all.

Leah: And kind of just leading from that, don’t accuse something of being counterfeit if it’s just that you don’t want somebody to sell that product.

Chris: Right.

Leah: The product needs to be actually counterfeit. And you also need to have a live trademark. Your trademark can’t be pending if you’re… Well, you can’t report counterfeit if your trademark is [00:15:00] pending. That’s something that- Yeah … maybe a lot of people run into, and that can get your brand registry revoked.

Also can open you up to lawsuits, so generally speaking, if it’s not counterfeit, don’t report it as counterfeit.

Chris: All right. Thanks everybody. If you’re going to the New York Seller Growth Summit that Amazon’s doing next week, July 16th, you wanna get together, like I said, we’re co-hosting a happy hour with several other wonderful sponsors that I’ll put in the show notes. Let us know. And we hope to see you there if we don’t see you at the actual Growth Summit.

Otherwise, of course, the Growth Summit’s in Midtown Manhattan, one day only, July 16th, and it’s the first of its kind in New York, so let’s see how it goes. And thanks again, Leah, for all your insights. We will see you next week either on this podcast or in person. Bye.