E-commerce giant Amazon will pay $2.5 billion to settle US Federal Trade Commission (FTC) claims that it used misleading tactics to enrol customers in Prime subscriptions. Of this, $1.5 billion will go to affected users, while $1 billion is a fine to the FTC.
Around 35 million Prime subscribers who signed up between June 23, 2019, and June 23, 2025, qualify for refunds. Customers who did not fully utilise Prime benefits, including Prime Video, will automatically receive a $51 payout under the settlement terms.
The settlement also allows customers to claim compensation if they faced issues cancelling their Prime subscription or were unable to cancel it. Amazon’s settlement ensures eligible users can seek reimbursement for difficulties experienced during their membership period.
Amazon has committed to making its Prime subscription process clearer. The company will introduce a conspicuous opt-out button, enhance cancellation procedures, and disclose subscription terms upfront, ensuring users understand commitments before enrolling in Prime membership.
As part of the settlement, Amazon will hire an independent third-party supervisor to monitor compliance with the new subscription rules. This step aims to ensure transparency and fairness in Prime enrolments and cancellations going forward.
Amazon Prime, launched in 2005, has become a major revenue driver for the company, reaching $23.9 billion in subscription income in the first half of 2025. Despite recent fee hikes, the programme continues to attract customers through benefits like fast delivery and Prime Video.
The Amazon’s subscription practices started under US President Donald Trump first term, but the formal case was initiated during President Joe Biden’s administration.
