Top Retailers: Lax E-marketplace Rules Stoke Crime, Congress Must Act

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Top Retailers: Lax E-marketplace Rules Stoke Crime, Congress Must Act
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In letter to Congress, big box, department stores say online marketplaces don’t do enough to vet online sellers. But it’s more complicated than that.

Industry Leaders Association, the group that spearheaded the letter, explained in a statement that “criminals will continue these brazen thefts as long as they are able to anonymously sell their stolen goods via online marketplaces.”

The companies didn’t single out Amazon or any other specific companies, but blamed “certain” online marketplaces for failing to ensure the integrity of their platforms. They argue that, despite retailers’ best security efforts, criminals will continue “capitalizing on the anonymity of the internet and the failure of certain marketplaces to verify their sellers,” unless Congress takes action.

The crime wave has numerous groups lining up in support of the bill. The Buy Safe America Coalition — which includes some of the letter’s co-signers, such as Levi Strauss & Co. and Ulta Beauty, among others like Gap Inc. and J.C. Penney Co. Inc. — along with groups like American Apparel & Footwear Association, Footwear Distributors and Retailers of America and the Fashion Jewelry and Accessories Trade Association called the act a “common sense” approach.

But resale and peer-to-peer platforms see the bill as an existential threat. Citing privacy concerns for individuals and the potential impact on the secondhand sales business, eBay, Etsy, Mercari, OfferUp and Poshmark founded the Coalition to Protect America’s Small Sellers in March. Others have been lining up to criticize the measure as well.

As for established retailers, it’s notable that Target Corp., the only company on the list that operates a marketplace with third-party sellers, is a co-signer. That may be because its Target Plus offering is an invitation-only affair that evaluates each merchant before granting access to its sales platform. So it may already do the vetting demanded by the bill. However, since it doesn’t disclose its criteria for acceptance, its policy remains opaque.

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