Why are Related Account Suspensions Taking Down Thousands of 3P Amazon Sellers?

First it was a trickle. Then a stream. Now the suspension of Amazon sellers for “related accounts” has become a virtual flood.

Why has this suddenly become the most-common suspension for third-party sellers? And didn’t Amazon recently change its policy to allow more than one account? Keep reading for all the details, as well as strategies to protect yourself from this challenging enforcement by Seller Performance.

The Policy Change That Started It All

Earlier this year, Amazon updated its policy for multiple accounts. In the past, if a merchant wanted to own more than one Amazon seller account, they had to request approval from Seller Performance and follow a set of simple rules. 

The most important of these rules was that the accounts could not sell the same inventory. Ideally, the accounts wouldn’t just avoid listing identical ASINs. They would stay away from listing ASINs from the same brands – or even the same categories. Amazon enforced this rule for several reasons:

1. To prevent the sale of ASINs suspended for inauthentic, counterfeit, and other violations. By prohibiting sellers from offering the same ASINs across multiple accounts, Amazon ensured that an ASIN reactivated on one account for a serious problem did not suddenly appear on another account. After all, the seller would be offering the same units of inventory that generated the counterfeit or inauthentic complaint.
2. To stop anti-competitive behavior. A seller with multiple offers on a single ASIN – whether from one account or several accounts – can manipulate pricing, tweak the Buy Box, and otherwise game the system.
3. To keep bad actors off of the platform. If a seller account was blocked from Amazon, the company doesn’t want to see all of the same problematic inventory and policy violators pop up again under a different name.

With the policy change earlier this year, Amazon said no advance permission was now necessary for one merchant to have multiple seller accounts. However, these sellers must have a valid business reason for doing so. Plus, Amazon explicitly stated that if one account is suspended for whatever reason, the platform reserves the right to suspend all of the accounts that the seller owns.

Suddenly, Enforcement

In late spring, we started seeing more clients with suspensions for “related accounts.” To be specific, the language that typically accompanies these suspensions is as follows:

Your Amazon.com Seller account has been deactivated in accordance with section 3 of Amazon’s Business Solutions Agreement. Your listings have been disabled. Funds will not be transferred to you but will be held in your account while we work with you to address this issue. This may take up to 90 days, but funds may be held longer. Please ship any open orders to avoid further impact to your account.

We found that your account is related to an account that may not be used to sell on our site. As a result, you may no longer sell on Amazon.com.

In some cases, these suspensions are valid:

• The seller used multiple accounts with no good business reason for doing so, other than having a “backup” in case suspended.
• The seller had an account in the past that was closed for violating Amazon’s policies, and they started up a new account.

In other cases, these suspensions are somewhat reasonable. Amazon’s technology picked up patterns of data that caused them to believe the seller had multiple accounts in violation of its policies. Unfortunately, Seller Performance suspends first and allows explanations later:

• The seller was an employee at an Amazon business in the past, and now they have their own seller account in a similar industry.
• The seller has family members who also sell on Amazon, legitimately, with totally separate businesses.
• The seller has broken off past relationships with business partners who still own an Amazon account, while starting up a new account for themselves

Finally, sometimes, Amazon makes flat-out mistakes and suspends accounts for false positives because sellers have:

• Shared IP addresses or shared office spaces with other, unrelated sellers
• Closed their own account many years ago and then recently signed up for a new seller account on Amazon
• Received past permission from Amazon to sell on multiple accounts
• Opened legitimate accounts in other marketplaces, such as Canada or Japan

What Happens Next?

When Amazon suspends a seller for related accounts, there are three important steps to take:

1. Identify the linkage. Which accounts is Amazon accusing the seller of being related to, exactly?
2. Address the past account suspensions for all related accounts. That’s right. Amazon expects you to get any past closed accounts reinstated first – even if you don’t own them. If you cannot get them reinstated because they don’t belong to you, it’s imperative you prove that you have no ownership stake or current operating interest.
3. Get your current account reactivated, after completing steps 1 and 2.

In a few, straight-forward cases, Seller Performance will reinstate the account(s) after a solid Plan of Action is submitted.

But, be warned. Even in cases where Amazon suspended for a false positive, Seller Performance denies the vast majority of appeals. Unfortunately, front-line Seller Performance investigators don’t feel empowered to turn these accounts back on. The technology told them that there was a disallowed linkage, and they trust the technology.

Our team escalates these cases to various teams in Amazon to get the accounts reinstated.

Protect Yourself – and Your Account

There are measures that sellers can take to protect themselves from a suspension for related accounts: 

1. Make sure there are no linkages between your Amazon account and another selling account, such as account owners, tax ID numbers, bank accounts, credit cards, IP addresses, warehouse addresses, etc.
2. If you have more than one account, ensure you have a valid business reason for doing so. This might be using one account for private-label products and another for goods purchased via wholesale. Alternately, some sellers develop multiple brands on separate accounts. Other merchants have different accounts for different categories, like beauty and auto parts.
3. If you have more than one account, never sell the same inventory. Stay away from offering the same items, brands or – if possible – categories.
4. If your account is suspended for related accounts, be ready to provide a reasonable explanation – even if you’re guessing.
5. Be ready to offer detailed verification information about your account. This might include your driver’s license, passport, utility bill, and business formation documents.

If you’re stuck or have questions, please don’t hesitate to contact Riverbend Consulting. We are happy to discuss your case.