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A tweet by a popular U.S. Congresswoman brought into the spotlight a report about U.S. tech behemoth Amazon's tax burden for the past two years. While the company paid no U.S. federal income tax, it reported "cash taxes paid" of $1.2 billion last year and $957 million in 2017. These numbers are not broken down geographically, so it is difficult to know which government received the cash.
It may sound like a lot of money to dole out, but the gaming of Amazon reviews can be big business: According to an analysis by the e-commerce consultant Pattern, a one-star increase on an Amazon listing can pump up sales by as much as 26 percent, which is why so many sellers are juking the stats. According to the fraudulent-review-detection service Fakespot, around 42 percent of 720 million Amazon reviews assessed in 2020 were bogus. The review fraud is not distributed equally - with more scams in the $15 to $40 range of products, where brand names aren't a necessity. Think home goods and cheap-ish tech products that consumers don't expect to last forever. "When we look at categories where you can start drop-shipping a product and slapping on a logo and competing with other people, those have a lot of fraud," says Saoud Khalifah, founder of Fakespot. The most fraud-proof sector? "Books. You cannot fake a really detailed review talking about a book."
The scam is pretty easy. A company making a generic product in Shenzhen or Chennai uses an intermediary to set up a Facebook group, Twitter account, or Telegram channel with a name that attracts users looking for free merch. Private groups like "Amazon Product Review" and the more clandestine "R**fund Aftr R**vew" bring in tens of thousands of people willing to write a few sentences and take a couple pictures in exchange for a product - and maybe $5 to $10 on top. (The cash bonus is usually paid on PayPal, which Amazon does not use.)
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