AMZN Amazon.com Inc

By Alexandra Berzon and Daniela Hernandez 

As the coronavirus outbreak expanded across the globe, anxious shoppers turned to Amazon.com Inc. for face masks, hand sanitizer and other products promising to help protect against the virus.

The problem: Many didn't have federal certifications for the safety standards they were touting, some were counterfeit or deceptively labeled, and others were being sold at many times their usual prices.

More than 100 safety masks and respirators on Amazon were counterfeit or had unverifiable protection and certification claims, a Wall Street Journal investigation found.

There were several listings, for example, for a protective mask listed from a company called Benehal, which the Centers for Disease Control and Prevention's National Institute for Occupational Safety and Health, or Niosh, warned last year was a counterfeit.

Another listing for pink, latex-free gloves promised to "prevent coronavirus, flu and pneumonia." No consumer-grade gloves do that. Several other Amazon postings for fisherman-style hats with plastic face shields were being marketed as protection that "effectively isolates saliva carrying viruses."

At the same time, some sellers were taking advantage of the virus panic to price gouge.

Prices on Amazon spiked by at least 50% for more than half the listings of surgical masks and hand sanitizers in the weeks after the coronavirus crisis came to the U.S. in late January, according to a study by the consumer advocacy organization U.S. PIRG Education Fund.

The group found one case in which a package of 320 Lysol disinfecting wipes that typically sold for an average $13.57 over three months rose to $220 on March 3. It also found a listing for Purell sanitizer that normally sells for $7.99 going for as high as $49.95.

An Amazon spokeswoman said the price gouging is "a clear violation of our policies, unethical, and in some areas, illegal."

In a letter sent Friday responding to an inquiry from Sen. Ed Markey (D., Mass.) about price gouging, Brian Huseman, Amazon vice president for public policy, wrote that the company bans excessive prices and uses automated and manual methods to detect potential scams.

The company scans billions of price changes a week and has removed 530,000 offers and suspended 2,500 accounts because of coronavirus-related price gouging, he said. The company also removed millions of products that make unsupported claims about the coronavirus, he added.

Amazon said it is also working with several state attorneys general to prosecute offenders. "We will continue to assist all efforts to combat abuse in our store," Mr. Huseman wrote.

Mr. Markey later praised Amazon's response in a tweet. "All online retailers need to hold accountable predatory price-gougers who are profiting from panic," he said.

The retail giant is grappling with such problems, as it faces rising concerns from legislators and the public about the sale of dangerous, banned and counterfeit products on its vast online marketplace.

The challenge of policing bad actors and dangerous products is especially acute during major events that galvanize the public, when Amazon is swarmed with third-party sellers trying to capitalize on a sudden surge in demand. Ahead of the total solar eclipse in the U.S. in 2017, the website was overrun with counterfeit protective glasses that put users at risk of eye damage.

Amazon refunded customers who bought from third-party sellers that didn't provide documentation verifying their products complied with safety standards. Listings from sellers without documentation were also removed.

The Journal's examination of coronavirus-related products included an analysis of 194 listings claiming to be N95 or N99 masks, designations for the percentage of airborne particles that are filtered out when used properly.

Masks used in industrial settings in the U.S. must be certified by Niosh.

Of the listings, the Journal found that about 65% didn't appear to be Niosh-certified--making it impossible in many cases for consumers to know whether those masks would meet the N95 standard. The images included on some of those product listings appeared to be basic surgical masks instead of the more complex N95 respirator.

Sixteen of the listings made explicit certification claims that were either false or unverifiable.

A Niosh official who works on the verification of masks said the agency is having difficulty keeping up with the proliferation of improperly labeled or noncertified N95s online.

An agency spokesman explained that Niosh has very little if any legal recourse against sellers of masks claiming to meet the agency's standards but without going through certification.

All the Amazon listings for N95s included in the Journal's analysis were from third-party sellers, and many appeared to be newly created, based on the dates of the earliest comments. Many of the listings were also sponsored content, meaning the seller paid for high placement in relevant searches.

N95s are special masks used by health-care workers to protect themselves from germs patients might spread. But public-health experts warn that even fully certified masks are ineffective for the general public--and can even be dangerous for giving a false sense of security--because they have to be correctly fitted and tested.

As the novel coronavirus spreads, mask shortages have become a key challenge, even as health officials tell consumers not to buy them. Some medical providers are now turning to less reliable sellers online.

"A lot of health-care providers are at institutions or settings where there's a shortage, and so doctors themselves are going online [and] buying masks," said Daniel Griffin, an infectious disease physician at Columbia University Irving Medical Center in New York.

Dr. Griffin said some of his colleagues had acquired purported N95 masks online, though he hadn't seen them in use at any of the hospitals where he works.

Other, smaller online marketplaces have also struggled recently to fight price gouging and questionable products targeting the outbreak. Marketplaces operated both by Facebook Inc. and eBay Inc. were still carrying N95 masks from third-party sellers earlier this week, after both said last week that they were blocking sales.

EBay's ban covered all coronavirus-related safety gear. That followed an alert by the California attorney general that the state's declaration of a state of emergency had triggered a law making it a crime to price-gouge emergency and medical supplies.

EBay was still working this week to take down coronavirus-related safety products, according to a person familiar with the matter.

In addition to the N95s, the Journal also found more than a dozen new listings on Amazon for disposable gloves that falsely claimed to have been approved by the Food and Drug Administration. The names of the products and manufacturers didn't appear in an FDA database of registered items.

The U.S. PIRG study found that price spikes for virus-related products were more robust among third-party sellers. Mask prices rose by much more than hand sanitizers, spiking an average of 166% during that time.

Even products Amazon sold itself showed increases: The prices of nearly one in six were 50% higher than the average over the preceding three-month period, the organization found.

The group used price-tracking software to examine prices on Amazon for the highest-ranking search results in the weeks after the World Health Organization declared a global health emergency on Jan. 30 as compared with the average 90-day price between Dec. 1 and Feb. 29.

Many of the listings analyzed by the PIRG and the Journal were later removed from the site or listed as unavailable.

On Sunday evening, Adam Garber, a researcher for PIRG pointed out that a company called ErYao was listing a generic bottle containing less than 2 ounces of hand sanitizer for $459.

Mr. Garber said sellers were taking advantage of people who are "freaking out and hitting 'buy' on something and trusting the system to get them the right thing," he said.

Asked for comment through Amazon's messaging system, a person using the ErYao seller account said the price was based on the cost of the materials.

Shane Shifflett contributed to this article.

Write to Alexandra Berzon at alexandra.berzon@wsj.com and Daniela Hernandez at daniela.hernandez@wsj.com

(END) Dow Jones Newswires

March 11, 2020 05:44 ET (09:44 GMT)

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