Amazon to Pay $2.5 Billion Over Deceptive Prime Sign-Ups – FTC Settlement 25 Sept 2025

Amazon to Pay $2.5 Billion to Settle FTC Allegations of Deceptive Prime Sign-Ups – 25 Sept 2025

Washington, D.C. — 25 September 2025 — Amazon has agreed to pay $2.5 billion to settle allegations by the U.S. Federal Trade Commission (FTC) that the company misled millions of customers into enrolling in its Prime subscription service without clear consent.

Under the settlement, $1 billion will be paid as a civil penalty and $1.5 billion will go toward customer refunds. Roughly 35 million Prime users who signed up between 23 June 2019 and 23 June 2025—and either received incomplete disclosures or used fewer than three Prime benefits—are eligible for automatic payments.

According to the FTC, Amazon used unclear free-trial offers and design tactics that caused people to sign up unintentionally. The agency also said Amazon deliberately made cancellation difficult through a process it internally nicknamed “Project Iliad.”

While Amazon did not admit wrongdoing, it has agreed to:

Provide clearer subscription terms and a prominent opt-out button

Simplify cancellation to a one-click process

Allow an independent monitor to ensure compliance

The settlement ends a federal lawsuit in Chicago alleging Amazon “knowingly trapped” customers in recurring Prime fees and obstructed cancellations.

Eligible customers will automatically receive an average $51 refund, and those who unsuccessfully tried to cancel may file additional claims.

Consumer-rights advocates hail the deal as a landmark victory, warning other tech giants that dark-pattern marketing and “subscription traps” will face tougher enforcement. Analysts say the case highlights a growing global push for transparency and fair digital-commerce practices.

Though the agreement is not an admission of guilt, it forces Amazon to revamp its Prime policies and sends a clear signal: even the biggest tech firms must respect consumer-protection laws.