A group of sellers on Amazon are bringing legal action against the consumer giant accusing it of freezing sales proceeds varying from £100 to up to £300,000. Lawyers claim hundreds of British sellers have had funds unlawfully frozen for various reasons including being falsely accused of incorrectly filing taxes or selling counterfeit goods.
The frozen money is the sale proceeds sellers have earned from selling their products – and has in some cases been held for over a year, lawyers claim. Rosenblatt law firm, which this week announced it is preparing to take legal action, said frozen fees could amount to tens of millions of pounds.
A spokesperson for Rosenblatt said: “Thousands of pounds in frozen funds may not seem like much to a multi-billion-dollar business like Amazon, but for its sellers it is essential to provide for their family, and existential for their small businesses.”
The law firm has already been contacted by multiple sellers who claim to have fallen victim to the sales cash frozen by Amazon, a spokesperson said. Part of the problem, the law firm claims, relates to the automation of its complaints process which can leave sellers in an endless loop where they are unable to speak to an amazon employee directly to solve the issue.
The frozen money then arbitrarily becomes unfrozen, in some cases after a few days, but in others for much longer, with no explanation, they said. One, who wishes to remain anonymous, had over £100,000 frozen by Amazon 18 months ago – and still can’t access the money.
They said: “I’ve been pleading with Amazon for nearly 18 months to unfreeze my funds. We had been a seller on Amazon for almost 10 years, and this is the second time they’ve done this to us.
“I went above and beyond to provide them with invoices, supplier and buyer information, item descriptions, and quantities, yet I am still waiting to receive my money.”
The legal action aim to win compensation for affected sellers and force Amazon to unfreeze their funds, the law firm says. A spokesperson for Rosenblatt says sellers have already taken to Amazon’s own seller forums to complain.
Some say they are facing bankruptcy and are having suicidal thoughts after months of being unable to access their money, they claim. The anonymous seller said: “It’s been a humiliating process.
“In the end we were forced to take legal action, but with Rosenblatt’s help, I’m finally close to recovering my funds. We work incredibly hard as sellers to meet all of Amazon’s criteria and standards, but they treat us like second-class citizens—ignoring us and sending automated emails.
“It’s time for us to fight back. I encourage anyone else in my situation to submit their information to Rosenblatt and join our legal action.”
Dean Nicholls, partner at Rosenblatt, representing affected sellers, said: “Amazon’s agreement with its sellers has very clear rules for what it can and cannot do. We believe that Amazon’s treatment of so many of its sellers is a clear breach of that agreement.
“We encourage all sole traders and businesses that sell goods on Amazon in the UK to consider joining our legal action to fight for compensation if their funds remain unlawfully frozen.”
An Amazon spokesperson said: “Our selling partners are incredibly important to us and our customers – and we do everything we can to help them grow and succeed. Amazon is committed to providing a trustworthy shopping and selling experience, and we maintain a robust set of policies and guidelines for our customers and sellers to do business.
“Over 100,000 small and medium sized businesses in the UK sell on Amazon’s store and more than half of all physical product sales are from independent selling partners, and the fact is that we only succeed when the businesses we work with succeed.”