Amazon Announces Lawsuit to Combat Fraudulent Affiliate Marketing Schemes

Rhea-AI Summary

Amazon.com, Inc. has filed a federal lawsuit in the Western District of Washington against unnamed individuals for running an illegal advertising scheme that misuses Amazon's name. The lawsuit aims to combat fraudulent text messages and fake surveys that trick consumers into clicking links, leading them to unrelated marketers. Amazon has previously taken significant action against similar scams, including filing multiple lawsuits and securing over $1.5 million in damages. The company emphasizes its commitment to protecting consumers and its brand integrity.

Positive

• Amazon's proactive legal action against fraudulent schemes demonstrates its commitment to consumer protection.
• The company has successfully filed five lawsuits against such schemes, showing a strong track record in brand protection.

Negative

• The existence of these fraudulent schemes indicates ongoing vulnerabilities in consumer trust and brand reputation.
• These scams could lead to financial losses for affected consumers and potential damage to Amazon's brand image.

Amazon.com, Inc. (NASDAQ: AMZN):

What:

Amazon today filed a federal lawsuit in the Western District of Washington against several yet-to-be-named individuals for operating an illegal advertising scheme. The bad actors in question are using Amazon’s name in text messages and on fake surveys as part of an affiliate marketing scheme. The suit allows Amazon to expand its investigation and hold the bad actors accountable. This suit is part of the company’s growing efforts to protect consumers from schemes that fraudulently use Amazon’s name.

Bad actors in these schemes profit by creating fraudulent text message campaigns that drive traffic to advertisers and websites. These fake text messages are intentionally designed to trick unsuspecting consumers to click on a link by using Amazon’s name and offering recipients “rewards” or other “gifts.”

Instead, victims are redirected to a website to take a survey, which also fraudulently uses Amazon’s brand and promises a reward for participation. Once participants click for their reward, they are sent on to online marketers, advertisers and websites to buy products or services that have no relation to Amazon. The defendants profit from fees paid to them by affiliate marketing networks and advertisers for the fraudulently created traffic.

Amazon invests significant resources to protect customers and its brand, and has a history of identifying and shutting down similar operations. Amazon has already filed five lawsuits against fraudulent affiliate marketing schemes, won multiple injunctions in court to stop the illegal activities, and entered settlements with seven parties in which they agreed to stop their campaigns and pay in excess of $1.5 million in damages.

Statement (attributable to Kathy Sheehan, VP, Business Conduct & Ethics, Amazon)

“Amazon works hard to build a great, trusted experience for our customers and sellers. These bad actors are misusing our brand to deceive the public and we will hold them accountable. We also want to remind consumers to be vigilant and learn how to recognize the signs of a scam so they are protected, no matter where they shop.”

Additional Background:

• Case: 2:21-cv-00627, United States District Court for the Western District of Washington
• The Better Business Bureau offers simple tips on how to recognized and avoid scams, https://www.bbb.org/article/scams/8767-bbb-tips-10-steps-to-avoid-scams
• In March 2021, the U.S. District Court of Utah the Federal Trade Commission’s filed order against four companies for operating a telemarketing scheme that fraudulently used Amazon Associates’ name to offer fake work-from-home opportunities.
  https://press.aboutamazon.com/news-releases/news-release-details/ftc-obtains-permanent-ban-and-2m-judgment-work-home-scammer
• In June 2020, Amazon shut down three email based affiliate marketing schemes in Michigan, Colorado, and California.
  https://press.aboutamazon.com/news-releases/news-release-details/amazon-stops-multiple-fraudulent-affiliate-marketing-schemes
• In April 2019, Amazon stopped an Illinois-based affiliate marketer, First Impression Interactive, Inc. and its owners from advertising fake work-from-home jobs with Amazon. As a result of Amazon’s efforts, First Impression and its owners are now prohibited from using Amazon’s brand in any future marketing.
  https://chicago.cbslocal.com/2019/04/10/amazon-work-from-home-job-scam-first-impression-interactive/

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20210511006213/en/

FAQ

What is the recent lawsuit filed by Amazon (AMZN) about?

Amazon has filed a federal lawsuit against individuals for operating an illegal advertising scheme that misuses its name.

When was the lawsuit filed by Amazon (AMZN)?

The lawsuit was filed recently in the Western District of Washington.

How much has Amazon (AMZN) won in settlements against fraudulent schemes?

Amazon has secured over $1.5 million in settlements from previous fraudulent marketing schemes.

What actions has Amazon (AMZN) taken against similar scams in the past?

Amazon has filed multiple lawsuits and won injunctions against fraudulent marketing operations, demonstrating its commitment to consumer protection.