Alibaba, US payment unit settle DOJ probe for $600M

Chinese e-commerce giant Alibaba Group and its U.S.-based payment processor have agreed to pay a combined $600 million to resolve a federal investigation into illegal pharmaceutical and controlled substance sales on their platforms. The settlement, announced on July 1, 2026, resolves allegations that the companies failed to prevent tens of thousands of unlawful transactions over nearly a decade.

Under non-prosecution agreements with the Department of Justice, Alibaba and AUS Merchant Services admitted to shortcomings that allowed merchants to sell and import illegal products into the United States through Alibaba.com and AliExpress.com. The companies acknowledged that from January 2016 through December 2024, roughly 80,000 transactions violated federal laws, generating more than $200 million in gross merchandise value. The products included pharmaceuticals, controlled substances, precursor chemicals, and equipment used to manufacture counterfeit drugs.

The Justice Department stated that federal agents conducted more than 40 undercover purchases of illegal items through the platforms to build its case. Investigators found that some merchants used private messaging features or...