I think overall Amazon is making a mistake. When I interviewed with them a few years ago, they were well aware of the risk of short-term best choices being bad

I think overall Amazon is making a mistake. When I interviewed with them a few years ago, they were well aware of the risk of short-term best choices being bad in the long term (can't elaborate due to NDAs). For instance, in the short term it's better to take the loss instead of investigate. But that then makes your platform an easy pick for fraudsters, so you end up with way more fraud and way more costs overall. If you were a bit more thorough and spotted scammers better, you would have a higher cost _per incident_ but lower cost overall in the long term. This is particularly true if you are such a big player that you are the market in practice (so general equilibrium effects cannot be ignored anymore). And reminds me a bit of what eBay did in the past (sided with buyers almost every time without investigating, and made selling much more difficult).