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Several states consider legislation targeting fake online sales

Online shopping
Posted at 2:00 PM, Apr 18, 2022

Retail theft has spiked during the pandemic, and as states wait for federal action, a growing number are taking matters into their own hands when it comes to online marketplaces.

Recent measures aim to prevent both theft and fraudulent sales on platforms like Amazon, eBay and Facebook.

Illinois, Ohio, Arkansas, Alabama and Colorado have all passed legislation and more are considering it, according to the Retail Industry Leaders Association.

“Really what we're trying to get at is to make it harder to sell stolen goods from behind a fake screen name, a fake business,”said Jason Brewer at the Retail Industry Leaders Association.”

“Folks that are using the anonymity of the Internet to dupe consumers into buying something that's stolen,” Brewer said.

RILA says this is a win for both online retailers and the general public.

However, Amazon has raised concern that states doing this on their own will create a patchwork of regulations and end up hurting law-abiding sellers.

They're encouraging states to wait for the bill in congress to pass.

RILA agrees a federal measure would make things more cohesive but says most states have been following the bill in congress as a framework.

There won't be different kinds of regimes that folks will have to sign up for. It'll just be (…) if you're a small business, you're really providing the marketplace you're selling through with some very basic business information. So it really wouldn't matter what state you're in where you were buying from where you were selling to,” Brewer said.

For those in states that don't have protections yet, Brewer suggests double-checking that a seller is legitimate before buying what may seem like a good deal.

Counterfeit items can have more consequences than just wasting your money.

“A lot of folks that are selling fake knockoff, some oftentimes dangerous products that don't meet safety standards are made with dangerous chemicals, perhaps, have lead in them,” said Brewer.

An item having bad reviews or no reviews at all can be a red flag, as well as the seller lacking a real website.