U.S. markets closed

House Lawmakers Demand Amazon, eBay Take Stronger Action Against Stolen And Fake Products

Shivdeep Dhaliwal

A group of lawmakers from both major political parties has asked Amazon Inc. (NASDAQ: AMZN) and eBay Inc. (NASDAQ: EBAY) to take stringent action against non-genuine, unsafe or stolen goods on their platforms.

What Happened

House lawmakers want Amazon and eBay to take stock of the threat posed to consumers by “organized retail crime,” said Representative Jan Schakowsky, Fortune reported. Speaking before a panel of consumer advocates and technology company executives on Wednesday, he commented, “Online marketplaces need to place safety and accountability to consumers before profit.” 

Representatives from both online retail giants outlined their efforts to fight the sale of spurious goods and protect their customers. eBay associate General Counsel Amber Leavitt and Dharmesh Mehta, testified that their companies were using technology to identify fakes and will continue to lend support to law enforcement in investigating fraudulent sellers.

Why It Matters

One in four U.S. consumers has been the victim of fraudulent purchases in the past year. The median amount spent on counterfeit goods was $69 per person in the 12 months period ended in October 2019.

In January 2020, the Department of Homeland Security released a report urging “strong government action,” encouraging the private sector to self-police in order to resolve the counterfeit goods issue.

Bipartisan lawmakers have introduced the Shop Safe Act of 2020 aimed at curbing the sale of fake goods. The bill mandates online sellers to establish “best practices” to vet sellers to ensure their legitimacy.

Price Action

Amazon shares traded 0.80% lower at $1,960 in the after-hours session on Wednesday. The shares had closed the regular session, 3.5% higher at $1,975.83.

eBay shares traded 0.94% lower at $38.13 in the after-hours session on Wednesday. The shares had closed the regular session 4.82% higher at $38.49.

See more from Benzinga

© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.