Amazon Settles FTC Allegations Over Prime Enrollment Practices for $2.5 Billion

Amazon has agreed to a $2.5 billion settlement with the Federal Trade Commission (FTC) to resolve allegations that the company enrolled consumers in its Prime subscription service without their consent and made it challenging for them to cancel. The settlement includes a $1 billion civil penalty and $1.5 billion allocated for consumer refunds.

The FTC accused Amazon of employing "sophisticated subscription traps" to mislead online shoppers into enrolling in Prime and subsequently creating obstacles for subscribers attempting to cancel.

Approximately 35 million customers who were affected by these practices between June 23, 2019, and June 23, 2025, are eligible for refunds.

Under the settlement terms, Amazon is required to:

• Implement a clear and conspicuous button for customers to decline Prime enrollment.
• Provide upfront disclosures about Prime's cost, billing dates, auto-renewal, and cancellation policies.
• Simplify the cancellation process, ensuring it is straightforward and accessible through the same method used for enrollment.
• Fund an independent third-party supervisor to monitor compliance with the settlement terms.

Amazon stated that the company and its executives "have always followed the law" and emphasized their commitment to making it clear and simple for customers to sign up for or cancel their Prime membership.

This settlement marks one of the largest consumer protection agreements in recent years and underscores the FTC's commitment to addressing deceptive subscription practices.