Amazon’s third-party marketplace is chock-full of independent sellers hawking everything from Korean face masks to out-of-print books and moon boots. From a business perspective, the system works great for the e-commerce giant: Amazon gets to sit back and collect fees from those sellers, whose sales on the platform continue to grow. In 2017, for the first time, more than half the products sold on Amazon came from those marketplace listings, rather than from Amazon itself.

But it’s also causing at least one major headache for Amazon. Some third-party sellers have been using the reach of Amazon’s marketplace as an opportunity to sell counterfeit and pirated items. The pressure on the company has been growing as brands such as Birkenstock and Mercedes Benz have lambasted it for not being able to control the problem. Now, CNBC reports, Amazon for the first time has acknowledged sales of counterfeits and pirated items as a risk in its annual earnings report to investors and the US securities and exchange commission.

Under the section of “risk factors” to the business, Amazon says it “could be liable” for the activities of its sellers, and explains:

“Amazon has finally admitted to investors that it has a counterfeit problem,” Quartz, February 5, 2019

Sheesh.