Amazon Agrees to Pay $2.5 Billion Over Prime Subscription Complaints

SEATTLE, Washington — Amazon.com will pay a historic $2.5 billion to settle allegations from the Federal Trade Commission (FTC) that the company deceived customers into signing up for its Prime subscription and made it difficult for them to cancel. The settlement, announced Thursday, includes a $1 billion civil penalty and $1.5 billion in refunds to affected customers.

According to FTC officials, about 35 million consumers who were harmed by Amazon’s practices could qualify for refunds of up to $51 each. Customers who signed up for Prime between June 23, 2019, and June 23, 2025, through certain offers will automatically receive compensation, as documented in the FTC’s legal filings.

The FTC stated that this settlement represents the largest civil penalty in an FTC rule violation case to date. It also marks the second-highest restitution award obtained by the agency in its history, illustrating the significant impact of unfair business practices.

FTC Chairman Andrew Ferguson emphasized the win for consumers, stating, “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.” He added that this settlement will return billions of dollars to Americans.

Amazon has responded to the allegations by asserting that it has always followed the law, without admitting any wrongdoing. Spokesperson Mark Blafkin said, “We work incredibly hard to make it clear and simple for customers to both sign up or cancel their Prime membership, and to offer substantial value for our many millions of loyal Prime members around the world.”

As part of the settlement agreement, Amazon must create a “clear and conspicuous” button for customers to decline a Prime subscription offer. The company is also required to make cancellations easier for its users, addressing the FTC’s concerns over misleading subscription renewals and complex cancellation processes.

The settlement concludes a two-year legal battle that began under the Biden administration when the lawsuit was filed in June 2023. It reflects growing scrutiny of large tech companies and their business practices, especially regarding customer treatment.

Amazon’s subscription model has significantly contributed to its revenue, generating over $44 billion from Prime subscriptions in the last fiscal year alone. However, the company is currently facing additional scrutiny as the FTC investigates whether Amazon’s practices breach antitrust laws.

In light of the settlement, the FTC is also advocating for new regulations that would enforce clearer cancellation processes across different industries, further supporting consumer rights.