Amazon Will Pay $2.5 Billion for Misleading Customers Into Amazon Prime Subscriptions

Core Insights - Amazon reached a $2.5 billion settlement with the Federal Trade Commission (FTC) regarding allegations of misleading customers about Amazon Prime subscriptions, marking one of the largest consumer protection settlements in U.S. history [1][2] Settlement Details - The settlement allocates $1.5 billion to a fund for repaying eligible subscribers and $1 billion as a civil penalty [2] - Amazon is required to implement a "clear and conspicuous" option to decline Prime during checkout and to simplify the cancellation process [2] FTC Allegations - The FTC accused Amazon of employing "dark patterns" to manipulate consumers into subscribing to Prime and complicating the cancellation process, violating Section 5 of the FTC Act and the Restore Online Shoppers' Confidence Act [4][5] Eligibility for Payouts - The settlement applies to customers who enrolled in Amazon Prime between June 23, 2019, and June 23, 2025, specifically those who used a "challenged enrollment flow" or faced difficulties in canceling their memberships [6] - Specific enrollment pages were identified by the FTC, and claimants must not have used more than 10 Prime benefits in any 12-month period to qualify for payouts [7] Payment Process - Customers who signed up through challenged processes and used no more than three Prime benefits within a year will receive automatic payments from Amazon within 90 days [8] - Other eligible customers must file claims, and Amazon is obligated to notify them within 30 days of making automatic payments [8] Payment Amounts - Payouts to eligible claimants will be capped at $51, which may be reduced based on the number of Prime benefits utilized during the subscription [9]