Amazon's $2.5B Prime Scam Settlement

Amazon has agreed to a substantial $2.5 billion settlement with the U.S. Federal Trade Commission concerning its practices for enrolling customers into Amazon Prime between June 23, 2019, and June 23, 2025. The FTC accused the online retail giant of employing "dark patterns"—manipulative user-interface designs—to trick consumers into unwanted auto-renewing subscriptions. This settlement aims to rectify those deceptive tactics that made it difficult for customers to cancel their memberships.

The financial penalty includes $1.5 billion designated for refunds to eligible subscribers, with the remainder serving as a civil penalty. Amazon is now mandated to provide a clear and simple option for customers to decline Prime, ensuring the cancellation process is as easy as the sign-up. The company has begun distributing payments to eligible individuals, with automatic payments expected to conclude by December 24, 2025.

Customers who enrolled through challenged processes and used minimal Prime benefits may receive automatic payments within 90 days. Other affected individuals will need to file a claim, with Amazon required to notify them about the process. Payouts are capped at $51 per eligible claimant, with the amount potentially reduced based on the number of Prime benefits used, such as free shipping or Prime Video access.