New Federal Law Informs Consumers About High-Volume Sellers In Major Online Marketplaces

Congress recently passed a new federal law that took effect in June 2023. The law requires major online marketplaces such as Amazon and eBay to provide consumers with more information about some of their most active sellers. The INFORM Consumers Act (which stands for Integrity, Notification, and Fairness in Online Retail Marketplaces) requires sites like Amazon to provide the contact information for “high volume” third-party sellers on the seller’s product page or in order confirmation messages and account transaction histories.

This information will help consumers research the company with which they are dealing, report stolen, counterfeit, or unsafe products, and contact the company directly. “High-volume” sellers are defined as any third-party seller who logs more than 200 sales and grosses over $5,000 in a year.

Online marketplaces are now required to share a qualifying seller’s entire name, physical address, and contact information (including a working phone number, working email address, or other methods of direct messaging that are provided by the seller.

Marketplaces that fail to implement the new rules could face financial penalties. States as well as the federal government have the power to enforce these rules. The Federal Trade Commission (FTC) requires that online marketplaces also must give shoppers a way to report suspicious conduct. This includes issues such as counterfeit merchandise, expired products, and items that look different than how they were advertised.

Anyone seeking more information about the INFORM Consumers Act, including what actions you can take if you suspect there has been a violation, should visit the FTC’s webpage.

How to protect yourself in online marketplaces 

Online marketplaces contract with third-party sellers to sell their wares in a virtual flea market. It’s relatively easy for just about anyone to set up an account on these sites and sell items. So, consumers sometimes face fraud that targets these marketplaces, are sold unsafe products, or knock-offs posing as the real thing. To protect yourself, you should:

• Stick within the marketplace – One red flat that consumers ought to be aware of is when a seller wants to do business outside of the online marketplace. A business transaction that occurs outside the marketplace may not be covered by the site’s consumer protections.

• Beware of unusual payment methods – Consumers are advised to be wary of sellers who request payment through wire transfer, gift card, or other unusual methods. Consumers should also note that peer-to-peer payment systems are rife with fraud. While Venmo and Zelle work well for transferring money to close friends and family, they should never be used to conduct a business transaction.

• Overpayment scams – Sellers must also be aware of potential scams. A phony buyer can send a seller a check for more than the agreed-upon amount, then request that the overpayment be sent back to them. The check, however, won’t clear and the seller will be out that money.

Talk to an Ohio Consumer Fraud Attorney Today 

Kohl & Cook Law Firm, LLC represents the interests of Ohio consumers who have been the victim of fraudulent or unconscionable business practices. Call our Columbus consumer lawyers today to schedule a free consultation, and learn more about how we can help.

Source:

ohioattorneygeneral.gov/Media/Newsletters/Consumer-Advocate/August-2023/New-federal-law-helps-inform-consumers-about-high