A federal grand jury in the state of Washington has indicted six people on charges of bribing Amazon.com employees to gaining advantages for third-party sellers on the retailer's online storefront.
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Each of the defendants provided consulting services to vendors on Amazon’s marketplace, according to the U.S. Attorney's Office in Seattle, and they collectively paid more than $100,000 in bribes to the e-commerce giant's workers.
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The people charged include two former Amazon workers who prosecutors say bribed company employees to reinstate the sale of products deemed inferior or even dangerous.
They also reportedly worked to attack clients’ rivals and used inside access to suspend accounts and share proprietary details about Amazon’s algorithms for listings, The Wall Street Journal reported Friday.
In exchange for the money, Amazon insiders provided the defendants with access to proprietary Amazon data and -- in some cases -- credentialed access to the company’s systems, prosecutors asserted.
In a statement, Amazon said that the company supported the investigation and had worked with federal agencies involved in the case.
“Bad actors like those in this case detract from the flourishing community of honest entrepreneurs that make up the vast majority of our sellers,” Amazon said.
The Journal reported that two of the defendants, Joseph Nilsen, 31, and Kristen Leccese, 32, had provided consulting services through a company called Digital Checkmate Inc.; Ephraim Rosenberg, 45, had spearheaded a similar effort called Amazon Sellers Group TG; Hadis Nuhanovic, 30, had provided fee-based consulting and led his own third-party seller accounts; and former Amazon employees Rohit Kadimisetty, 27, and Nishad Kunju, 31, also became consultants to third-party sellers.
At least 10 Amazon employees and contractors accepted bribes in the scheme, prosecutors said.
The wire fraud and wire-fraud conspiracy charges against the group carry prison sentences of up to 20 years plus fines, the U.S. attorney’s office explained. An additional charge of conspiracy to use a communication facility in furtherance of commercial bribery could carry up to five years in prison and fines.
The group of six are slated to appear in U.S. District Court in Seattle on Oct. 15.
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“As the world moves increasingly to online commerce, we must ensure that the marketplace is not corrupted with unfair advantages obtained by bribes and kick‑backs,” U.S. Attorney Brian T. Moran said in a statement. “The ultimate victim from this criminal conduct is the buying public."
Business practices on Amazon’s marketplace have come under increased regulatory scrutiny over the past year, and Amazon has struggled to block the sale of faulty products.
In April, The Wall Street Journal reported that the tech giant was using data on third-party sales to launch its own competing products, which sparked a congressional investigation on antitrust grounds.
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