Question

Amazon: Describe the fraud risks (Please be industry specific)

Need sources of articles for the information that affects fraud in Amazon

Answer 1

	What is Fraud Risk ?
	The risk of organization exposed to fradulant actictivies is called fraud risk such as cash defalcation.
	Fraud risk affecting Amazon
1	Amazon follows a 3 tire system : 1) Amazon retail tier 2) Fulfilled by Amazon 3)Amazon Market place
	Fullfilled by Amazon is most exposed to fraud risk such as counterfeit issues. In this case customer are not aware that they counterfeit and blames the brand
	(Source : Eric Perrott, trademark and copyright attorney with Gerben Law Firm)
2	As per Amy Zeigler (shareholder of Greer Burns & Crain ) counterfeit problems extend across all major online retail platforms, including Amazon.
	Nearly 90 percent of all global counterfeit products seized by U.S. customs agents in 2017 came from China and Hong Kong.
3	Susan Frohling, Counsel at Brinks Gilson & Lione, has represented brand owners who sell luxury goods and who have had to deal with unauthorized sales of their genuine products on Amazon.
	Generally, these products are only supposed to be made available through a network of authorized dealers, but brand owners have difficulty controlling downstream access due to the first sale doctrine, which generally allows for resale of genuine products in an unchanged state.
	“Somehow, the products get out of their normal distribution channel and they end up on Amazon, ” Frohling said. “That can be very problematic in a luxury goods context, where a brand owner will want to protect pricing and provide consumers with a specialized sales force and warranties, which they miss out on when they buy the products online.”
	Such unauthorized sales on Amazon can hurt a brand owner’s reputation with consumers if the Amazon retail price is much lower than the retail price through authorized dealers, and it can hurt relationships with those dealers who feel the price difference is unfair.