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Amazon sales consultant admits bribing employees to help customers

An influential consultant for Amazon Sellers admitted on Monday that they bribed employees of the e-commerce giant for information to help its customers boost sales and get their suspended accounts reinstated.

Ephraim “Ed” Rosenberg wrote in a LinkedIn post that he would plead guilty in federal court to a criminal charge, stemming from a 2020 indictment that charged six people with conspiring to give sellers an advantage. unfair competition in Amazon’s third-party marketplace. Four of the defendants have already pleaded guilty, including a former Amazon employee who was sentenced last year to 10 months in prison.

Rosenberg, who is based in Brooklyn, is a well-known figure in the world of Amazon third-party sellers. He runs a consulting business that advises entrepreneurs on how to sell products in the online marketplace and how to deal with unforeseen issues with their Amazon account. Rosenberg’s Facebook group for sellers, ASGTG, has more than 68,000 members and hosts a popular seller conference each year.

“For a while, a few years ago, I started getting and using Amazon’s internal annotations – the private property of Amazon – to find out the reasons for sellers’ suspensions, in order to help them get reinstated, if possible,” wrote Rosenberg, who is due to appear in U.S. District Court in Seattle on March 30 for a plea hearing change, according to court records. “On some occasions, I bribed, directly and indirectly, Amazon employees to obtain endorsements and reinstate suspended accounts. These actions were against the law.”

Just last month, in LinkedIn messages to CNBC, Rosenberg denied prosecutors’ allegations, calling the case a “conspiracy” and saying he was set up. On Monday, Rosenberg said he “regrets” his involvement in the bribery scheme.

“During this case, I have made public statements about this prosecution and the indictment,” Rosenberg said. “These statements are not accurate and I disavow them. This statement I am making now is accurate and true and I will continue to stand by it.”

Since at least 2017, prosecutors have alleged that Rosenberg and other consultants bribed Amazon employees to leak information about the company’s search and ranking algorithms and to share confidential data about their market competition. . In total, the individuals allegedly paid $100,000 in kickbacks to employees and reaped more than $100 million in competitive advantages, the DOJ said.

In 2018, Amazon fired four employees in India who were allegedly linked to the bribery scheme.

Previously unsealed court documents said Rosenberg allegedly sent a “veiled threat” to an Amazon employee at the company’s headquarters in Seattle as part of the bribery scheme, Bloomberg reported. The documents also detailed the defendants’ elaborate efforts to evade detection by authorities, including stuffing a llama-shaped bean bag with money believed to be bribes, according to Bloomberg.

Rosenberg is part of what has become a significant industry in helping sellers navigate the complexities and chaos of the Amazon marketplace, where some 2 million sellers are responsible for more than half of the merchandise sold on the site. Amazon launched its online marketplace in 2000, allowing everyone from established brands to family-owned stores to sell products.

While the marketplace has helped Amazon achieve tens of billions of dollars in sales, it has also become a notorious host for counterfeit, unsafe and expired products. Behind the scenes, scammers have for years used illicit tactics to crush competitors, artificially boost listings, or circumvent Amazon’s marketplace rules.

Amazon said it invests hundreds of millions of dollars a year to ensure product safety and compliance. The provision of internal data to sellers by employees violates Amazon’s Seller Policies and Code of Conduct.

Rosenberg said the attempts to bribe Amazon employees are “wrong and criminal.”

“No one should bribe Amazon employees to provide private information about Amazon,” Rosenberg wrote Monday. “If it is obvious that inside information has been illegally leaked, no one should use it. No one should pay Amazon employees for any other special favors regarding a seller’s account either.”

A lawyer for Rosenberg declined to comment.

An Amazon spokesperson told CNBC in a statement that it has systems to detect suspicious behavior and teams working to stop prohibited activity in the marketplace.

“Amazon is grateful to have worked with federal authorities in their thorough pursuit of this matter,” the spokesperson said. “There is no place for fraud at Amazon, and we will continue to hold bad actors accountable.”

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