Amazon to Refund $1.5 Billion to Prime Subscribers in FTC Settlement

Amazon has agreed to a $2.5 billion settlement with the Federal Trade Commission (FTC) following allegations that the company enrolled customers into its Prime subscription service without clear consent and made the cancellation process challenging. The settlement includes a $1 billion civil penalty and $1.5 billion allocated for consumer refunds.

FTC Chairman Andrew Ferguson stated, > "Today, we are putting billions of dollars back into Americans’ pockets, and making sure Amazon never does this again."

An Amazon spokesperson responded, > "Amazon and our executives have always followed the law, and this settlement allows us to move forward and focus on innovating for customers."

The FTC estimates that approximately 35 million consumers were affected by these practices. Eligible customers include those in the United States who signed up for an Amazon Prime membership or attempted to cancel between June 23, 2019, and June 23, 2025.

Refunds will be distributed in two phases. The first phase involves automatic refunds to customers who enrolled through specific enrollment flows identified by the FTC and used no more than three Prime benefits within any 12-month period. These refunds are capped at $51 per customer and will be issued within 90 days of the FTC order.

In the second phase, Amazon will send claim forms to other eligible customers within 30 days after the initial payouts. This group includes individuals who unsuccessfully attempted to cancel their Prime membership or used up to 10 Prime benefits over any 12-month period. Customers will have up to 180 days to submit their claims via email, prepaid mail, or a settlement website. Amazon is required to review and process these claims within 30 days of receipt.

As part of the settlement, Amazon has also agreed to implement clearer language on sign-up pages, provide explicit disclosures about auto-renewal terms, and simplify the cancellation process to ensure transparency and ease for consumers.