Just days into a jury trial over what the Federal Trade Commission (FTC) termed “deceptive Prime enrollment practices,” Amazon agreed to pay a $1 billion civil penalty and provide $1.5 billion in refunds to customers who were harmed. The original FTC complaint, filed in June 2023, charged the company and several Amazon executives with violating the FTC Act and the Restore Online Shoppers’ Confidence ACT (ROSCA).
“The evidence showed that Amazon used sophisticated subscription traps designed to manipulate customers into enrolling in Prime, and then made it exceedingly hard for consumers to end their subscription,” said Andrew Ferguson, Chair of the FTC in a statement. “Today, we are putting billions of dollars back into Americans’ pockets, and making sure Amazon never does this again.”
Amazon also must cease what the FTC termed “unlawful” enrollment and cancellation policies and make meaningful changes to Prime membership, including:
A “clear and conspicuous button” for customers to decline Prime;
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- Disclosure of all material terms of Prime during the enrollment process, including date and frequency of charges, whether the subscription auto-renews and cancellation procedures;
- Providing an easy way for consumers to cancel Prime; and
- Paying for an independent third-party supervisor to monitor Amazon’s compliance with the consumer redress distribution process.
The FTC also is engaged in an antitrust case against Amazon alleging that the company uses “interlocking anticompetitive and unfair strategies to illegally maintain its monopoly power,” according to the FTC. However, that case has run into several roadblocks, including the March 2025 dismissal of a shareholder lawsuit and the October 2024 dismissal of parts of the FTC’s suit.
At press time Amazon had not responded to Retail TouchPoints’ request for comment, but it did provide the following statement from spokesperson Mark Blafkin to The Information: “Amazon and our executives have always followed the law and this settlement allows us to move forward and focus on innovating for customers. We work incredibly hard to make it clear and simple for customers to both sign up or cancel their Prime membership, and to offer substantial value for our many millions of loyal Prime members around the world. We will continue to do so, and look forward to what we’ll deliver for Prime members in the coming years.”
