Amazon Bans Hundreds of Chinese Companies For Review Fraud

Amazon.com Inc (NASDAQ: AMZN) has announced that over 600 Chinese brands sold through 3,000 different seller accounts have been permanently banned.

What Happened: The tech giant says the removal of the vendors from its platform is part of a five-month global effort to target companies that are violating Amazon’s policies, according to a report from The Verge.

Among the high-profile companies to be banned are Aukey, Choetech, and RavPower. Although several vendors have been using sub-brands to continue selling products like earbuds, wireless charging pads, and batteries on Amazon.

One of Amazon’s largest Chinese retailers, Shenzhen Youkeshu Technology (commonly known as YKS) indicated in early July that Amazon had closed 340 of its online stores, and assets worth over $20 million were frozen.

Related Link: Where Amazon.com Stands With Analysts

Why It’s Important: Amazon has issued a statement indicating that customers are relying on the accuracy and authenticity of product reviews to make purchasing decisions. Any company that abuses this feature will be suspended, banned, and legal action will be taken against all those who violate Amazon’s policies.

The tech giant adds that additional steps are being taken to detect abuse and to take enforcement action against bad actors. Especially vendors who knowingly engage in multiple and repeated policy violations, including review abuse.