Six people, including an Indian national and an Indian-American, were indicted by a US grand jury on Friday with conspiring to pay over USD 100,000 in commercial bribes to employees and contractors of Amazon for unfair competitive advantage on its merchant platform.
According to the indictment, all the six accused used bribery and fraud since 2017 to benefit merchant accounts on Amazon Marketplace, a platform where third-party merchants sell goods, resulting in more than USD 100 million of competitive benefits to those accounts, harm to competitors and harm to consumers, the US Justice Department said.
The accused have been named as Nishad Kunju, 31, from Hyderabad, Rohit Kadimisetty, 27, from California, three from New York — Ephraim Rosenburg, 45, Joseph Nilsen, 31, and Kristen Leccese — and Hadis Nuhanoviv, 30, from Georgia.
They have been charged with conspiracy to use a communication facility to commit commercial bribery, conspiracy to access a protected computer without authorisation, conspiracy to commit wire fraud.
They will make their initial appearances in US District Court in Seattle on October 15, the Department of Justice said.
“As the world moves increasingly to online commerce, we must ensure that the marketplace is not corrupted with unfair advantages obtained by bribes and kick-backs,” said US Attorney Brian Moran.
“The ultimate victim from this criminal conduct is the buying public who get inferior or even dangerous goods that should have been removed from the marketplace,” he said.
“Realising they could not compete on a level playing field, the subjects turned to bribery and fraud in order to gain the upper hand,” said Raymond Duda, Special Agent in Charge, FBI Seattle.
“What’s equally concerning, not only did they attempt to increase sales of their own products, but sought to damage and discredit their competitors,” he said, adding that this indictment should send a message that the FBI will not sit on the sidelines while criminals try to cheat their way to the top.
The indictment alleges that they served as consultants to so-called third-party (“3P”) sellers on the Amazon Marketplace. Those 3P sellers consisted of individuals and entities who sold a wide range of goods, including household goods, consumer electronics, and dietary supplements on Amazon’s multi-billion-dollar electronic commerce platform.
In addition to providing consulting services to these 3P sellers, some of the defendants, including Nilsen, Leccese, and Nuhanovic, made their own sales on the Amazon Marketplace through 3P accounts they operated.
In the course of the conspiracy described in the indictment, they paid bribes to at least 10 different Amazon employees and contractors, including Kunju, who accepted bribes as a seller-support associate in Hyderabad, India, before becoming an outside consultant who recruited and paid bribes to his former colleagues.
In exchange for those bribes, the corrupted employees and contractors reinstated suspended merchant accounts and product listings on the Amazon Marketplace; facilitated attacks against competitors; misappropriated Amazon’s highly confidential business information and circumvented Amazon’s internal limits on 3P accounts.
In a statement, Amazon said that “the company work hard to build a great experience for customers and sellers, and bad actors like those in this case detract from the flourishing community of honest entrepreneurs that make up the vast majority of its sellers.”
Amazon has systems in place to detect suspicious behaviour by sellers or employees, and teams in place to investigate and stop prohibited activity, it said.
“We are especially disappointed by the actions of this limited group of now former employees, and appreciate the collaboration and support from law enforcement to bring them and the bad actors they were entwined with to justice,” the company said.