Lawmakers Send Strong Message To Amazon CEO

Global e-retail giant Amazon Inc. (AMZN), saw their antitrust law worries compound on Monday after senate lawmakers blamed the company executive of lying in the Federal Trade Commission hearing.

In the light of the event, the House Judiciary Committee's antitrust subcommittee is planning to ask the Department of Justice to lodge a criminal investigation against the company.

Last week, Reuters said that it has access to thousands of documents including emails, strategy papers, and business plans, that show that the online retail giants are taking deceitful measures to promote in-house merchandise at the expense of other sellers. The documents stand testaments to how the company systematically used the search results to boost the sales of its products which are just cheap knockoffs of the original products in the sub-continent.

A letter signed by names like Jerrold Nadler, David N. Cicilline, Ken Buck, Pramila Jayapal, Matt Gaetz, the committee members told Amazon, "In light of the serious nature of this matter, we are providing you with a final opportunity to provide exculpatory evidence to corroborate the prior testimony and statements on behalf of Amazon to the Committee. We strongly encourage you to make use of this opportunity to correct the record and provide the Committee with sworn, truthful, and accurate responses to this request as we consider whether a referral of this matter to the Department of Justice for criminal investigation is appropriate."

Even founder and former CEO Jeff Bezos is being brought in the mud as he had previously said in a hearing that the company doesn't use seller data for its personal gains. Nate Sutton, the general counsel to the company, had said in 2019 that Amazon doesn't use seller data to compete with its rivals.

The statement added, "We investigate any allegations that this policy may have been violated and take appropriate action. In addition, we design our search experience to feature the items customers will want to purchase, regardless of whether they are offered by Amazon or one of our selling partners."

The report that blew it all up last week claims that the employees inflated the sales of the knockoffs to make sure that the search engine can be rigged to make sure that the Amazon products come on top of the list. In a 2016 strategy, the company also wanted the in-house products to be in the first 2/3 options on the list.

The report also showed how Amazon copied the measurements of shirts made by the brand John Miller to a tee and produced their knockoffs to win over the buyers. The documents also said that Amazon studied underlying information of each brand to find out the selling points or USPs of each performing brand so that they can knock it off. These products were called reference or "benchmarks".

Speaking about the report, the lawmakers said, "At best, this reporting confirms that Amazon's representatives misled the Committee. At worst, it demonstrates that they may have lied to Congress in possible violation of federal criminal law."

The chairperson of the subcommittee, David N. Cicilline wrote on Twitter, "We're giving Amazon one last chance to come clean about how they abuse other seller's data and unfairly advantage their own products."

Amazon CEO Andy Jassy has been given a deadline till November 1 to come clean.

Amazon declined any of the claims and told The Journal, "Like other retailers, we look at sales and store data to provide our customers with the best possible experience. However, we strictly prohibit our employees from using non-public, seller-specific data to determine which private label products to launch. While we don't believe these claims are accurate, we take these allegations very seriously and have launched an internal investigation."

For comments and feedback contact: editorial@rttnews.com

Business News

Follow RTT