PRIME TARGET

Amazon to Pay $2.5B for ‘Deceptive’ Prime Membership ‘Trick’

The retail giant is also expected to make signing up and cancelling Prime subscriptions far easier.

Billionaire Jeff Bezos’ Amazon will cough up $2.5 billion to compensate customers in a “historic” settlement. The Federal Trade Commission (FTC) accused Amazon of illegally using “manipulative, coercive, or deceptive” designs to “trick” shoppers into enrolling in auto-renewing Prime subscriptions and making cancelling too hard. Amazon did not admit to any wrongdoing. “Today, the Trump-Vance FTC made history and secured a record-breaking, monumental win for the millions of Americans who are tired of deceptive subscriptions that feel impossible to cancel,” said FTC Chairman Andrew N. Ferguson in a press release. $1 billion of the settlement will be a civic penalty, the largest ever for a FTC rule violation. The remaining $1.5 billion will repay eligible Prime subscribers. Prime customers who signed up for a membership via the company’s ‘Single Page Checkout’ between June 23, 2019 to June 23, 2025 will get $51 as long as they can show they were unintentionally enrolled in Prime, or were deterred from canceling their subscriptions. The settlement also requires the company to change its Prime enrollment and cancellation methods, including adding a clear button for customers to decline Prime. “Amazon and our executives have always followed the law and this settlement allows us to move forward and focus on innovating for customers,” said Amazon spokesperson Mark Blafkin in a statement.