Amazon Withholding Money? How We Recovered $1.4 Million
We recover withheld funds, get suspended Amazon accounts reinstated and help Amazon Sellers with many issues.
Release of $1.4 Million in Withheld Funds
Our paralegal Vin Famularo had been working a pre-arbitration matter for a client with just under $1.4 million in withheld funds. Vin has been with us for almost 10 years. He has obtained hundreds of Amazon reinstatements and addressed thousands of IP Complaints against Sellers.
“Amazon stated they are dispersing the funds without a fight.”
With amounts this large, it typically turns into “an all-out war” and requires the filing of an expensive Arbitration against Amazon. But, in this case, and with Vin’s team of Former Amazon Staff on our team, proper documentation and strategic legal pressure obtained the release of the Seller’s funds without filing for an arbitration against Amazon.
Why Amazon Withholds Sellers’ Money
Your Amazon seller account gets suspended, and Amazon holds your disbursements during investigation. The Business Solutions Agreement gives them this authority.
Common triggers: policy violation flags from automated systems, Order Defect Rate spikes, related account suspicions (even when wrong), trademark infringement claims, and counterfeit allegations without a test buy.
How Withheld Money is Usually Obtained from Amazon
Filing a Demand for Arbitration moves your case out of Seller Performance and onto the desks of Amazon’s legal team. Our experience after working with thousands of Amazon Sellers is that the filing of an arbitration against Amazon is usually needed when Amazon is refusing to release funds in excess of a few hundred thousand dollars.
In the $1.4 million case, the seller had tried everything through normal channels. When we prepared the pre-arbitration correspondence with proper documentation and evidence that the hold was unjustified, Amazon released the money before we formally filed.
Amazon Arbitration: How It Works
When pre-arbitration doesn’t resolve your case, filing through the American Arbitration Association may be your path to reinstate your Amazon account.
You draft a Demand for Arbitration stating what you want: account reinstatement, release of withheld funds, or both. Amazon responds through outside counsel. The AAA assigns an arbitrator who hears both sides and issues a binding decision. However, if a hearing is needed, the arbitrator lacks the power to order reactivation. Arbitrators can only order Amazon to pay money or release inventory.
For disputes up to $10,000, Amazon pays arbitration costs if you prevail. For $10,000 to $50,000, the AAA’s expedited system resolves cases within 90 days.
Why Sellers Choose Our Amazon Law Firm
Rosenbaum & Segall, P.C. has focused almost exclusively on Amazon seller legal issues since 2016. We’ve helped tens of thousands of sellers and recovered more than $10 million in withheld funds.
I’ve written six books on Amazon seller legal topics. The Wall Street Journal, Forbes, Bloomberg, and FOX Business have quoted me on Amazon enforcement issues. I speak regularly at Prosper Show, Global Sources Summit, and Retail Global — the conferences where serious Amazon sellers go to learn.
Our team includes former Amazon employees, including Rahul and Farha, who worked inside the system and know how enforcement decisions actually get made. Brian Malkin brings 30+ years of litigation and intellectual property experience including admission to the Patent Bar to our firm.
How to Reinstate Your Amazon Account and Recover Withheld Funds
An Amazon account suspension doesn’t have to be permanent. Your withheld funds don’t have to stay withheld.
The Business Solutions Agreement provides for arbitration. It’s not a loophole. It’s the dispute resolution mechanism Amazon agreed to.
Frequently Asked Questions
How long can Amazon hold seller funds?
90 days minimum. Often longer if your account stays suspended. The sooner you pursue account reinstatement, the better your chances.
My Plan of Action keeps getting rejected. Should I file for arbitration?
If you’ve submitted multiple appeals without success, more of the same won’t help. Whether pre-arbitration communication or formal arbitration makes sense depends on how much is at stake and what documentation you have. We offer free consultations.
Will Amazon ban me for filing arbitration?
No. Arbitration is in the Business Solutions Agreement. It’s your contractual right. We’ve never seen Amazon retaliate for it.
Amazon claims my products are counterfeit but never tested them. What now?
This happens constantly. Amazon makes counterfeit claims without a test buy. If you have documentation showing legitimate sourcing, you may have a strong case for reinstatement and fund release.
Amazon withholding your seller funds? Call 1-877-9-SELLER for a free consultation. Our Amazon attorneys are available seven days a week.