Amazon Accused of Possibly Lying About Its Practices to US Congress

Five members of the US House Judiciary committee wrote to Amazon’s chief govt Sunday, and accused the corporate’s high executives, together with founder Jeff Bezos, of both deceptive Congress or probably mendacity to it about Amazon’s enterprise practices.

The letter additionally states that the committee is contemplating “whether a referral of this matter to the Department of Justice for criminal investigation is appropriate.”

Addressed to Amazon CEO Andy Jassy, the letter adopted a Reuters investigation final week that confirmed that the corporate had performed a scientific marketing campaign of copying merchandise and rigging search leads to India to spice up gross sales of its personal manufacturers – practices Amazon has denied participating in. Jassy, a longtime Amazon govt, succeeded Bezos in July.

The letter states that “credible reporting” within the Reuters story and up to date articles in a number of different information retailers “directly contradicts the sworn testimony and representations of Amazon’s top executives – including former CEO Jeffrey Bezos.”

“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 letter states.

In response, an Amazon spokesperson issued an announcement that stated: “Amazon and its executives did not mislead the committee, and we have denied and sought to correct the record on the inaccurate media articles in question.”

It added: “As we have previously stated, we have an internal policy, which goes beyond that of any other retailer’s policy that we’re aware of, that prohibits the use of individual seller data to develop Amazon private label products. We investigate any allegations that this policy may have been violated and take appropriate action.”

Since 2019, the House Judiciary Committee has been investigating competitors in digital markets, together with how Amazon makes use of proprietary vendor knowledge from its platform, and whether or not the corporate unfairly favors its personal merchandise.

In sworn testimony earlier than the Judiciary Committee’s antitrust subcommittee final yr, Bezos stated the corporate prohibits its staff from utilizing knowledge on particular person sellers to learn its personal private-label product traces. In one other listening to in 2019, Nate Sutton, Amazon’s affiliate basic counsel, testified that the corporate doesn’t use such knowledge to create its personal branded merchandise or alter its search outcomes to learn them.

Asked in the course of the 2019 congressional listening to whether or not Amazon alters algorithms to direct customers to its personal items, Sutton replied: “The algorithms are optimised to predict what customers want to buy regardless of the seller.”

The lawmakers’ letter offers Jassy “a final opportunity” to supply proof to corroborate the corporate’s prior testimony and statements. It additionally notes that “it is criminally illegal to knowingly and wilfully make statements that are materially false, conceal a material fact, or otherwise provide false documentation in response to a congressional investigation.”

It offers the CEO till November 1 to supply a sworn response to make clear “how Amazon uses non-public individual seller data to develop and market its own line of products” and the way Amazon’s search rankings favour these merchandise.

It additionally requests copies of all paperwork talked about within the October 13 Reuters investigation.

“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,” the letter states.

The Reuters probe was based mostly on hundreds of pages of inner Amazon paperwork – together with emails, technique papers and enterprise plans. They confirmed that, no less than in India, Amazon had a proper, clandestine coverage of manipulating search outcomes to favour Amazon’s personal merchandise, in addition to copying different sellers’ items – and that no less than two senior firm executives had reviewed it.

In response to the Reuters report, Amazon stated, “We believe these claims are factually incorrect and unsubstantiated.” The firm didn’t elaborate. The firm stated the best way it shows search outcomes would not favour private-brand merchandise.

The lawmakers’ letter additionally cites different current tales within the Markup, the Wall Street Journal and the Capitol Forum about Amazon’s private-brand merchandise and use of vendor knowledge.

The letter’s sharp wording ratchets up the rhetoric between Washington and Big Tech. Companies together with Amazon, Facebook Inc, Apple Inc and Alphabet Inc’s Google have been below rising scrutiny in Washington, Europe and different elements of the world, fuelled by considerations amongst regulators, lawmakers, and shopper teams that the corporations have an excessive amount of energy and are participating in unfair practices that harm different companies.

The lawmakers’ letter was signed by a bipartisan group, and included the judiciary committee’s chairman, Democrat Jerrold Nadler, and 4 members of the antitrust subcommittee – its chair, Democrat David Cicilline, vice chair Pramila Jayapal, and Republicans Ken Buck and Matt Gaetz.

On Wednesday, following publication of the Reuters investigation, US Democratic Senator Elizabeth Warren, a distinguished critic of Amazon, known as for breaking apart the corporate. In India, a bunch representing thousands and thousands of brick-and-mortar retailers urged Prime Minister Narendra Modi’s authorities to take motion in opposition to Amazon.

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