By Jonathan Eberle |
Amazon has agreed to pay a total of $2.5 billion in penalties and customer refunds to resolve a federal lawsuit alleging the company improperly enrolled users in its Prime membership program and made it difficult for them to cancel, according to a settlement announced on Sept. 25. The agreement stems from a 2023 Federal Trade Commission (FTC) lawsuit accusing Amazon of using deceptive design tactics—often called “dark patterns”—that allegedly pushed customers into Prime subscriptions without their informed consent. The company has repeatedly denied any wrongdoing but said it is settling the case to move forward.
According to court filings, $1.5 billion of the settlement will be distributed directly to Prime subscribers. Refunds will be capped at $51 per customer and automatically issued to eligible users within 90 days of the settlement taking effect. Those eligible for automatic payments include customers who were enrolled in Prime through specific online flows such as “Single Page Checkout” and similar enrollment pages between June 23, 2019, and June 23, 2025.
The FTC alleged that Amazon knowingly designed confusing interfaces that nudged or steered customers toward Prime subscriptions. The agency said internal documents revealed discussions among company executives acknowledging problems with both the enrollment path and the cancellation process. “Amazon created confusing and deceptive user interfaces to lead consumers to enroll in Prime without their knowledge,” the FTC said in its announcement. The complaint also accused the company of creating a “complex and difficult” cancellation process that impeded users’ ability to leave the service.
Under the settlement terms, Amazon must revise its user interface to ensure clearer options when customers are signing up for—or declining—Prime. That includes a requirement for a prominent ‘decline Prime’ button and more straightforward cancellation tools. In a statement released the same day, Amazon rejected the claims but said the agreement allows the company to avoid prolonged litigation.
“Amazon and our executives have always followed the law, and this settlement allows us to move forward and focus on innovating for customers,” the company said. It added that it works to make Prime enrollment and cancellation “clear and simple” and emphasized the value Prime offers to millions of subscribers worldwide. With the settlement now approved, Amazon will begin issuing refunds and overhauling portions of its checkout and subscription processes. Meanwhile, the company will pay the remaining $1 billion of the settlement as a civil penalty to the federal government.
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
