This is a hot holiday gift. There are several brands on the market.
They look fun.
In 2015, there was a rush of this new item,
More of a battery powered skateboard, nevertheless called a hoverboard.
They were just flooding Amazon.
But suddenly, batteries were going up in flames.
It’s on fire!
Fire departments were seeing this and were very concerned.
The hoverboard ignited while it was being charged
and actually rolled over to a bed and ignited the bedding in the bedroom.
Amazon is moving most brands from its site.
And I started to notice this pattern.
I found there were many other examples of items that were not
complying with safety standards that are set by governmental bodies
Or were set by Amazon
They were being thrown up online and sold to the public.
More and more consumers are becoming accustomed to shopping online.
That’s a low price.
With better prices, better reliability and convenience,
e-commerce is slowly every year growing in size.
Unfortunately, e-commerce is one of
the main ways illicit goods can enter into circulation.
We found 52 supplements that had been identified by the FDA and
the Justice Department as containing illegal prescription drugs.
There were several hundred masks that were not approved by the FDA,
4,510 balloons without choking hazard warnings
and 3,644 toys without the proper warning labels.
No consumer is willingly buying products which can
potentially injure their child.
Hospital officials confirm they're treating her son
for ingesting magnets.
Unfortunately, the refund is irrelevant if they actually had
damage to them or their kids.
My name is Alexandra Berzon.
I’m a reporter in the investigations group of The Wall Street Journal.
When I started looking at this incredible growth in
the marketplace of Amazon,
I started to see the potential consumer safety issues.
The salon grade hair dryer on Amazon, fresh out of the box.
Oh, my gosh.
We found thousands of products that were misrepresenting
safety, saying they had certain compliance that they didn't have,
claiming to be FDA approved,
trying to misrepresent and tell
the consumer that this item is safe when it's not.
So I ordered this. It’s a baby sleep positioner.
The FDA has said that these are not safe
because it can cause suffocation.
Every so often. I’ll go and look for the sleep positioner.
And without fail, within 30 seconds, I will always find it.
Let’s see. There it is. Yeah, it’s the second non sponsored one.
Here’s another one. So we’ve seen what now, at least four.
It’s even more this time, eight, nine, whoa, eleven.
Yeah, we’ve already found a whole bunch, a lot more than I had seen
like when I looked at this last time.
It looks like the baby from the box that I had ordered.
This is the one that the person is selling on Amazon.
This is Amazon's own picture of what not to sell on Amazon.
It used to be that you would walk into a store
and you understood that this store had assembled the products for you.
You know, they might have a few suppliers and they have
a pretty good idea of who those suppliers are.
They also have legal liability for the integrity of those products.
eBay is fast and easy,
Marketplaces online really changed that model.
Wal-Mart, Etsy, Wish, Alibaba, Target and other marketplaces
with Amazon being the leading one.
Amazon, when they started, was selling products
directly and they built up a lot of trust through that,
then at some point they decided we know what we could take that trust
and we could actually extend it to
a whole bunch of other people who are third party sellers.
Any business from anywhere can go in to Amazon and create a seller account
Sixty percent or more of their sales globally are actually coming from
those third party sellers.
The things you’re buying,
no one has actually hand-picked to be sold to you.
Everything is automated and it's also probably coming from
a foreign country far, far away.
E-commerce is great, just like a market with different stands,
different vendors.
But it's also becoming increasingly misused or abused by criminals.
They don’t care about norms, they don’t care about rules, regulations.
What they look for is money.
So any opportunity that arises is immediately exploited by them.
Most retailers they enforce quality checks
and they can often physically inspect products by sending their
staff to the actual factories.
The open marketplace Amazon is running prevents Amazon
from enforcing the same checks and balances in place
because it’s not a thing you can do
for millions of individual third party sellers.
Here’s another one.
After we sent Amazon
a list of every product that we found,
they did take many of them down.
And then again, we would find that this problem would just kind of
pop back up.
People are attempting to get through their barriers
and get to consumers.
A Tennessee family is suing Amazon for 30 million dollars
for negligence after a hoverboard caused
a fire that destroyed their home.
What happens if something goes wrong?
What protections do you then have?
We found one case where someone had died in a motorcycle accident
and the motorcycle helmet said that it was certified by
the Department of Transportation. And it turns out it wasn't.
The family wanted somebody to be responsible for that.
Amazon argues that it's not liable for
the products that it sells by third party sellers.
So Amazon is providing the platform, payment, processing,
the item is stored at the Amazon warehouse
and then Amazon is shipping it in an Amazon box.
But Amazon says at no point in that process are we
the actual seller of the item. We are just the platform.
The company that actually sold
the helmet through Amazon was just this one man who basically didn't
have enough money to pay for lawyers and they got
a judgment of, I think, over a million dollars.
But how are they going to collect that?
Amazon actually did agree to pay
without admitting any guilt or anything.
They paid five thousand dollars.
There's a whole regulatory structure and legal structure in
the U.S. that's based on
the idea of stores selling items.
With marketplaces online
this liability is still being worked out.
I think consumers have shown that they really like online marketplaces,
but consumers could become more aware of what they're buying
and where it's coming from.
Of course, at the end of the day,
we have lots of products that are cheap, but for criminals,
it means lots of opportunities for infiltration and for profits.
The bad actors will always find ways to evolve,
and it's a never ending battle trying to limit them.