The Federal Trade Commission (FTC) announced a massive $2.5 billion settlement with Amazon.com, Inc. The settlement resolves allegations that the e-commerce titan illegally enrolled millions of customers into its Prime subscription service without their consent and then deliberately made it difficult for them to cancel. The FTC charged that Amazon's practices violated the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA).
The $2.5 billion total monetary judgment, one of the largest in the FTC's history, is split into two critical parts: a record-setting $1 billion civil penalty and a substantial $1.5 billion in consumer redress. This consumer fund is earmarked for the estimated 35 million people impacted by unwanted Prime enrollment or deferred cancellation.
In a statement, FTC Chairman Andrew N. Ferguson said the organization "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."
"The evidence showed that Amazon used sophisticated subscription traps designed to manipulate consumers into enrolling in Prime, and then made it exceedingly hard for consumers to end their subscription." Ferguson continued. "Today, we are putting billions of dollars back into Americans’ pockets, and making sure Amazon never does this again."
Unpacking the Allegations
The allegations center on deceptive user interfaces, often referred to as "dark patterns," designed to lead consumers to enroll in the Prime service without their full knowledge. Court documents revealed that Amazon executives and employees were fully aware of these illegal practices. Internal communications captured comments like “subscription driving is a bit of a shady world” and described leading consumers to unwanted subscriptions as “an unspoken cancer.”
The cancellation process was allegedly just as complex, as the FTC claims it was designed to be difficult, costly, and time-consuming, effectively preventing consumers from ending their subscription.
What Changes for Shoppers? Bye-Bye Buried Buttons
To address the practices, the settlement requires Amazon to make key operational changes, ensuring future transparency and consumer control:
A clear and conspicuous decline button must be added. Amazon can no longer use language like, “No, I don’t want Free Shipping” as the only option to decline Prime.Full disclosure of material terms must be given during enrollment, including the cost, charging frequency, auto-renewal, and cancellation steps.Easy cancellation must be created, using the same method that customers used to sign up, ensuring the process is straightforward and swift.An independent, third-party supervisor will monitor the distribution of the $1.5 billion in refunds.Hence then, the article about amazon agrees to pay 2 5 billion settlement for allegedly misleading customers enrolling them in prime was published today ( ) and is available on Parade ( Saudi Arabia ) The editorial team at PressBee has edited and verified it, and it may have been modified, fully republished, or quoted. You can read and follow the updates of this news or article from its original source.
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