Does Amazon monitor for possible buyer fraud?


Let me first start by saying, I have no evidence this is occurring on a large scale. But I know it has probably happened to me a couple times, but not enough to affect my bottom-line. Just like shoplifting it WILL happen but as long as it is kept low a business can still make money. And I know 99.9% of buyers are awesome and have no intent of stealing. I fully understand Amazon’s policy of favoring the buyer in most situations and I agree with the policy. This buyer centered policies allow me to sell more items at higher prices, because buyers trust Amazon to protect them for shady sellers and they are willing to pay more for that assurance. But what assurances to I have as a seller against fraud buyers. About 1 in 300 or so packages show as delivered by post office, but customer will state it did not arrive. Since I know the post office does lose packages I ALWAYS believe the customer and issue immediate full refunds or ship another free. My question/suggestion is does amazon keep an eye on buyer fraud. Example: as a buyer I could buy multiple items from many different sellers and if I don’t sign for packages I could just lie and say I never received any of them and get free stuff. I know Amazon keeps a close eye on A-Z claims, but most good sellers like me just give refunds so the A-Z never happens. Does Amazon track a buyer who gets a lot of refunds, or makes a lot of where’s my stuff request? Another Example: As a buyer I could buy a product and claim it does not work, or is not as described. I know from personal experience amazon will take the customers side 9 times out of ten, again I know why. Does amazon keep an eye on customer returns for “not as described”, because again good sellers like me NEVER argue with the customer, I just refund to prevent A-Z and negative feedback. Again I have been doing really well, and I do not see this as a problem yet, but I would feel better if Amazon is monitoring buyer’s refund, return, and where’s my stuff actions for possible fraud. I just don’t want Amazon to become a Scammers paradise.


I just don’t want Amazon to become a Scammers paradise.
Too late. Already is.


In theory perhaps they do, in practice perhaps not. As you stated they are customer oriented and they assert that Signature Confirmation is the valid method of proof of receipt. As with any on-line sales there is always the chance that the item was really not received by the buyer or there is a scam. With the track record of successful sales you mentioned it is not something for you to worry about. Allegedly buyer’s have a maximum of AZ Claims which can be filed. However it seems that this number can be overturned by buyers calling Customer Service.


Yes, they do keep track, and they have even been known to ban a buyer now and then.



But Signature confrimation cost $2.20. I had over 7000 orders does amazon really expect me to pay over $15,000 to prevent buyer fraud. Amazon should support it sellers, since we are not allow to give buyer feedback, I have no way of knowing if I am dealing with an honest customer or a buyer who goes form many different sellers and takes advatage of Amazons many buyer protections.

I also understand Amazon’s vague limit of A-Z claims. A buyer may have dozens of very valid A-Z claims against very bad sellers and the buyer should not be punished because they are dealing with clearly bad sellers. On the other hand Amazon may see buyer making A-Z claims for everything and shut them down only after a few A-Z claims to protect good sellers.

My question is does amazon go further to track other fraud, or does it not even hit their radar until A-Z claims happen. Because my goal like many sellers is to have only a few A-Z claims or none.


Hey there Adam’s Discount Games,

Thanks for being a part of the forums.

We have a team that investigates buyers for fraud. Though we do not disclose what we look at, we have many metrics we look at when determining if a buyer is committing fraud.

We do recommend that you take your buyers at their word and offer customer service accordingly.


You are very, very ignorant.

1- Amazon accepts credit cards. Credit card companies require signatures, its part of the agreement between them and the cardmember and the merchants that do business with it.

Now that holds even when you go to a fast food establishment and swipe your card and “Surprise” they do not ask you to sign anything. They are managing their risk, that if they do not get a signature, they can run people through the line faster and get more sales especially at peak time and therefore even if they have someone who complains and said they did not make the card swipe transaction, well the general increase in profit will offset any charge back claims for any given period.

If as sellers we put signature requirements on every transaction, in many cases that $2.20 would eat up profit drive up costs and make unhappy customers who now had to go to the USPS to get their items. So we do not, although its part of our “risk reward management.”

Amazon recommends signatures for expensive items and items of high risk nature. Why? Simple. If the person claims a chargeback they will probably win as you do not have a signature. Its that simple. The USPS provided eDC/Tracking does not show a signature and therefore it is against the merchant account agreement to rely on it as proof of delivery.

2-Paypal with eBay transactions, since Paypal was originally designed to help lubricate eBay sales is somewhat more…lenient in fraud prevention and as long as you are sending within the terms of Seller Protections, and as long as the transaction is less then $250, Paypal will fund themselves non receipt claims from buyers when the seller has eDC/tracking showing delivery to buyer zip code address.

This does not mean that a buyer cannot file a credit card charge back, it does mean that if you do it enough, Paypal will terminate your buying ability.

Amazon self funds in many cases eDC supplied non receipt claims, usually when it does that it means that the person has history of it it would appear. At least that is the only thing that makes sense to me.

3-Fraud control and Risk mechanisms. Yes you can go and get a merchant account that would be cheaper then Paypal. But once you add the layers of Fraud and Risk protection, the pricing becomes similar or more to what Paypal charges, with less risk protection. Never forget Paypal was designed to help lubricate seller buyer transaction on eBay. Amazon itself also has such algorithms and controls factored into its payment processing side of our agreement.

4-A/Z. Sellers are so scared of A/Z damage that they refund without an A/Z claim being filed. Amazon has a known limit of allowing any buyer the ability of only 50 lifetime A/Z claims. If instead of refunding, sellers allowed the transaction to go to A/Z there is a chance that Amazon would self fund the claim. There is a certainty the buyer would use up their 50 claims, and Amazon could track buyers with an exceptional amount of claims and intercede earlier.

Since you just refund you are not allowing it to go to A/Z claim level.

You should be self insuring enough and have a high enough profit margin to handle .X% of claims of non receipt and the refunds that means. No system is both cheap enough to facilitate ease and use yet fully covering enough to remove all risk from you the seller. Think of your car insurance deductible. Cheapest way to save $250 a year is to up your deductible by $250. Put that first year in the bank and save $250 each year after.

If you are funding your non received claims, not letting them go to A/Z and having a larger percentage of them then every few hundred transactions either you are:

A) Selling a higher risk/fraud item and should increase selling price to fund/self insure better. Or reconsider selling it.

B) Not handling your customer responses well enough to defuse non receipt claims- Ie you are coming across as a push over.

C) Living in fear of A/Z. Only you know if your metrics can handle the claim, sometimes you got to make a stand. If you live in total fear of it, then yes you are paying on demand.

Edited by: chuck400b on Jan 2, 2014 11:14 AM


as far as i know, amazon does not keep an eye on scammers as you have mentioned in your posting. UNLESS, you bring it to their attention. (show that it has happened multiple times with you). i have done that in the past . however, to my disappointment, amazon still sided with the buyer. i have to say that i do deal with one buyer in particular, who has been doing that scam for years. buys and asks for it to be shipped overseas, then claims, her buyer never received it and demanded a full refund… this particular buyer has been scamming a lot of people on amazon for years. i brought it to the attention of amazon’s Fraud Dept, but they did not stop her at all, she changes names all the time, uses different credit cards etc… so, she continues. i have learned how to deal with her, but , it’s sad that there are absolutely no protection for sellers on amazon. Overall and in the grand scheme of it, i do sell a lot with amazon and i am very satisfied. however, you wonder to yourself, if i am losing a little bit here and there, it may not bother me; but, imagine how much amazon loses in commissions from these scams(and yet they don’t complain about it, or at least we don’t hear about it).



I will disregard that comment. I know you are just trying to be helpful. I do not want to live in fear of A-Z claims, but I hear alot of sellers being shutdown for little or no evidence of bad seller metrics. Your welcome to see my metrics: currently they stand at:
97% postitive feedback
short term defect rate: total = .13%, negative rate = .13%, A-Z claims = 0%, chargeback = 0%

Long term defect rate total = .23%, negative rate + .19%, A-Z claims = 0.04% chargback = 0%
customer metrics 90 days, Pre-fill cancel rate = .03%, late shipment = 0%, refund rate = 1.67%
Packages with tracking 90 days = 99.29%

, I work very hard to keep them good, because I am getting better and better at selling on Amazon I can not have my account shut down. I am holding around $40,000 in inventory and can sell that inventory in two months, but I don’t want to be left holding the bag, because I “Took a stand” over an $30 item. So as my post said, this does not affect my bottomline so giving a refund for every 300 orders works for me. My big question was what does Amazon do to keep scammers at bay. Based on my numbers they must doing something, because I am actually surprised that more buyers don’t take advantage of Amazon’s lop sided protections for buyers.


I have marked this one as answered, by Nelson. I just wanted some assurances that Amazon was looking out for sellers as well as buyers. I know Amazon does not want to be a haven for criminals to get free stuff. And again I believe they are taking such actions, because it does not happen that much.

On top of this in my research I found this website from US postal service, if any body still uses US mail like me.

From now on I will report all “lost packages” to the US postal ispectors and let the buyer know that I am going to report it. I will still give the full refund, but if they are bouncing from seller to seller getting free stuff and blaming the post office then at least the post office may pick up on the criminal activitity.

These are for those times with your packages shows as delivered, but buyer says the never got it. Which means, postal employee delivered to wrong adress (most likely in my opion), package was stolen out of the box, or customer lied about getting package. All of these possiblilities should be reported to the US postal inspectors and if the buyer is only having “lost packages” a couple times no big deal, but if it is happening every week, then the Post office can look into it.


Well I think amazon is looking at the big picture. Giving buyers a hard time about lost packages and making them pay for it and they will shop elsewhere. They know that sellers don’t have many options and are motivated by making money. So as long as I can make money on Amazon I will stay. Even if a seller is pushed away by Amazon’s tactics or just banned, Amazon knows another seller with take their place soon. All the items I sell have other sellers, so if I disappeared tommorrow Amazon will still make money and would not even send a post card asking where I went. And of course the have less interest in protecting sellers, does’t cost them anything to take a sellers money to give to buyer, if it keeps that buyer happy and buying on Amazon. That is the bottomline for Amazon and I do not blame them at all. Amazon is here to make money, not to make me money. But, I really do appreiciate the crumbs I get from the big table Amazon eats from. Keeps my family of 7 in a house with food, I will continue to work with what ever Amazon throws my way.


if you are so scared to never allow a non receipt claim to go to an A/Z then you must factor in your cost of refunding every 300 transactions into the price you sell the other 299 widgets.

If Amazon became stricter with buyers they would run the risk of alienating buyer base and losing money and commission.

If Amazon had stricter fraud control or re-embursed for you claims of non receipt then they would charge all sellers higher fees across the board.

You must manage your own risk and exposure within the realm of Amazon’s structure. Allowing a transaction to go to A/Z is really the only way to really let Amazon know about a problem customer.

You can own a Brick and mortar store, and actually employ 20 people to follow each and every customer around the entire time they are in the store, and even not let people in if you do not have enough escorts. But you would have to cover that labor cost and the fact that you could be losing business. 20 employees at $8 minimum wage for a 9 hour work day at a $1440 daily cost of labor seems high, or you can accept a percentage of theft and have less employees on and play with the numbers as they come in.

Your car insurance deductible is managing your risks and expense. A $100 deductible costs more and the company also knows there will be a greater number of claims. A $250 $500 or $1000 costs significantly less for you the consumer as the insurance company knows that they are not going to be beset by many claims.


We have had a few “bad apples” with regard to fraudulent claims for “not delivered” and “not as described” but they seem to increase every time we don’t do an investigation and seem easy.

Is there a blog or web site that tells people how to get free stuff from Amazon?


Thank you for the link to the usps.

We ship only usps priority mail and luckily only had 3 packages where the buyer said they did not receive. First we send the buyer a pdf of the detailed tracking info ( we use delivery confirmation and sometimes signature required). As soon as we file the claim with the usps and send the buyer a pdf of the acknowledgment from their online claim —the package magically is found.


>You can own a Brick and mortar store, and actually employ 20 people to follow each and every customer around the entire time they are in the store. . . or you can accept a percentage of theft and have less employees on and play with the numbers as they come in.

Yes, I do see and agree with your point. But there are large differences on Amazon vs. brick-and-mortar, esp. when selling commodity products. Buyers can more easily than in almost any other circumstance imaginable purchase from another seller who is not you, so keeping costs down is even more important. Those costs include buyer fraud.

If fraud is on the rise, and you are only as smart as your dumbest competitor, you may wait a long time for competitors to price in the increasing cost of fraud, and may go out of business due to lack of sales while you wait for them to do so due to the fraud. It’s a very tricky balance, I think, and one that is not really addressed by saying “You’d have these problems in a brick-and-mortar venue,” because of the ease with which customers can simply turn to another seller. They can’t as easily as that walk out of Dommie’s store and down the block to the next vintage game store . . . or even out of BN and down the block to the next bookstore. But they can very easily click on someone else’s item and buy it, if you are priced up to account either for fraud or for the cost of sig conf on a greater percentage of sales.

bunga bunga!


“Shrink” the industry colloquial for the things that cut into profit, be it unforseen costs, employee theft, customer theft, errors, mistakes and spoilage and it is a cost every business must plan for and account from in margins and pricing.

I would rather not sell anything then lose money on a sale. If someone is able to sell constantly cheaper then me they are either sourcing and handling costs better then me, or they have misplaced and it will correct itself. I am not going to chase to $0.


>“Shrink” . . . is a cost every business must plan for and account from in margins and pricing.

Yes. But on Amazon, they don’t. There are too many amateurs and idiots selling product, as you know from seeing them here every day. (“I’m not a business”, “I didn’t know all the parts had to be there”, “Do I have to refund?” etc.) Those people are not accounting for shrink in their pricing, and you could go out of business waiting for them to do so.

>I would rather not sell anything then lose money on a sale.

I can’t afford to not sell anything, given that the business has costs.

bunga bunga!


I do not understand your logic.

You are saying if an amateur or uninformed person is underpricing I should match prices and lose money? or are you saying you are just angry about it?

19 months ago I bought a book that weighed 3lbs for $1. There were some resale prices on it for $3 and $4 but most were over $10. I slapped $16 on it and figured if it sold in 3 years, the storage costs and the loss of that $1 cost on the book, plus interest would balance out.

Sold it in November for $16. Made reasonable profit even with the shipping at 4lbs

You cannot be controlled and stymied by the selling habits of the ignorant, amateur, and stupid. If you go to match them who exactly is ignorant, amateur, and stupid then? You need to look for better product or better margin control.

Any sale is a good sale as long as you are making money or making some calculated benefit.

No business stays around for too long when selling at a loss is deemed a better choice then selling at a profit or not selling at all. I understand that you have carrying costs on a monthly basis…thats why lots of businesses use credit lines and such to make ends meet between sales and sales peaks. If storage costs or materials cost that you have invested are an issue that you cannot deal with while waiting to sell at a profit well then you need to make the decision that liquidating now stems the bleeding. And make better buying decisions in the future.


Thanks for the heated discussion chuck and bunga. And yes as I said in my orginal post buyer fraud will always be a factor. But I am still making money, so I can handle some level of theft. Buy I fear as more people understand Amazon’s very unbalanced buyer protections, more scammers might take advantage. I have even heard of websites that teach buyers how to scam unsuspecting sellers and get away with it. So I wanted to know if Amazon takes efforts to curb this without upsetting honest buyers we deal with 99% of the time. Of course suspecting every buyer of fraud is wrong and will put me out of business fast. But in the end when I buyer steals from me, they are stealing from Amazon ( lost commission fees) and other buyers who now must pay more so I can still make a profit. Because like both of you agree I am not going to do this for free. I am trying to get enough sellers to help report possible buyer fraud for everyone’s benifit… except for the scammers who want free stuff.


>I do not understand your logic.

Well, I was as clear as I’m capable of being. In an analogous situation Oscar Wilde once said “The play was a success – the audience were a failure.”

bunga bunga!