The Inner Monologue

Why Online Retailers Like Amazon Must Be Liable for Fraudulent and Dangerous Products

Online retail platforms insist they are “just marketplaces.” That claim no longer survives contact with reality.

Modern platforms curate listings, control search visibility, process payments, warehouse inventory, set return policies, collect commissions, and—critically—profit from every transaction. When fraud or dangerous products pass through that system, the platform is not a neutral bystander. It is an active participant.

If online retail is going to enjoy the scale, efficiency, and profits of centralized commerce, it must also shoulder centralized responsibility.

The Proposal: Mandatory Platform Liability Refunds

A simple, enforceable rule would realign incentives immediately:

1. Fraudulent Products
   If a product is determined to be fraudulent (counterfeit, materially misrepresented, fake certifications, false branding):
   • 200% refund to the consumer
   • The extra 100% paid by the platform, not the seller
2. Dangerous or Defective Products
   If a product poses a safety risk or fails to meet basic product standards:
   • 100% refund minimum
   • Mandatory product removal and seller suspension pending review
3. Knowing or Repeated Violations
   If a platform knowingly allows fraudulent or defective products to be sold—or repeatedly fails to act:
   • Escalating penalties (treble damages, regulatory fines, or mandatory seller bans)
   • Loss of safe-harbor protections

This is not punitive excess. It is corrective economics.

Why the Current System Fails

1. Platforms Profit From Fraud—Asymmetrically

Platforms earn fees on every sale, including fraudulent ones. When fraud is discovered, the platform typically:

• Refunds the customer (sometimes)
• Passes the loss to the seller (if possible)
• Suffers no structural penalty

Fraud becomes a cost of doing business—cheap enough to tolerate at scale.

A 200% refund flips that math. Fraud is no longer “noise.” It becomes a direct hit to platform profit, incentivizing prevention rather than cleanup.

2. Consumers Cannot Realistically Vet Millions of Sellers

The entire value proposition of a platform is trust:

• Trusted search results
• Trusted reviews
• Trusted logistics
• Trusted checkout

Telling consumers to “be more careful” is dishonest when platforms deliberately blur the distinction between:

• First-party goods
• Third-party sellers
• Sponsored listings

If a consumer cannot reasonably distinguish risk, liability must follow power.

3. Platforms Are the Only Actor With System-Wide Visibility

Individual sellers see one storefront. Platforms see:

• Pattern fraud
• Repeat offenders
• Sudden listing changes
• Review manipulation
• Shipping anomalies

If the actor with the best data bears the least risk, fraud will persist.

Why Refund Multipliers Work Better Than Fines

Regulators love fines. Platforms absorb them.

Refund multipliers:

• Scale automatically with harm
• Compensate victims directly
• Create internal pressure to improve screening
• Do not require constant regulatory micromanagement

A 200% refund turns fraud detection into a profit-preservation function inside the company, not a PR problem.

“But Platforms Will Just Raise Prices”

Good.

If prices rise because platforms must fund:

• Better seller verification
• Safer supply chains
• Faster fraud removal

Then consumers are finally paying the true cost of commerce, rather than subsidizing fraud through risk and inconvenience.

Cheap goods built on deception are not efficiency—they are market failure.

The Moral Hazard of Knowing Inaction

The most dangerous category is not accidental defects. It is knowing tolerance:

• Re-listing banned products
• Ignoring regulator warnings
• Allowing sellers to reappear under new names
• Continuing to collect fees while “investigating”

Once knowledge exists, neutrality disappears. At that point, the platform is choosing profit over safety.

Escalating penalties are not optional—they are necessary to stop willful blindness.

The Bottom Line

Platforms like Amazon are not flea markets. They are infrastructure.

And infrastructure that moves unsafe or fraudulent goods must be held to a higher standard than a guy selling trinkets from a folding table.

A 200% fraud refund and a 100% safety refund are not radical. They are proportional.

If online retail wants the benefits of scale, trust, and dominance, it must also accept the responsibilities that come with them.

Markets work best when risk follows power.