The U.S. Department of Justice announced on Wednesday that Chinese tech giant Alibaba and its U.S. digital payment processor have agreed to pay $600 million (approximately 2.451 billion ringgit) to settle a federal investigation into whether they failed to prevent illegal drugs and controlled substances from being sold and imported.
The investigation was led by the Department of Justice and the U.S. Attorney's Office for the District of Rhode Island.
According to a statement from U.S. officials, Alibaba and AUS Merchant Services reached a non-prosecution agreement with the U.S. authorities on Wednesday to conclude an investigation into the companies' alleged violations of the Federal Food, Drug, and Cosmetic Act between 2016 and 2024.
Assistant U.S. Attorney First Class in Rhode Island, Calenda, stated that the United States is committed to "holding companies accountable when their platforms are used to facilitate the illegal sale of banned drugs, related pharmaceutical equipment, and other prohibited products within the country."
The Department of Justice said that under the agreement, Alibaba and its U.S. digital payment processor agreed to be responsible for the conduct of their employees and will strengthen the companies' compliance programs.
In a statement, Alibaba said that the settlement demonstrates Alibaba's full cooperation with regulatory investigations and its commitment to maintaining controls over the sale of non-compliant products.
Alibaba admitted that overseas customers purchased 80,000 items on the Alibaba platform that had not been approved by the U.S. Federal Food, Drug, and Cosmetic Act, with total sales exceeding $200 million (approximately 817 million ringgit).