Amazon to Pay $2.5 Billion Over Prime Membership Consumer ‘Traps’
If you ever felt confused by your Amazon Prime membership, apparently, you're not alone.
FTC reaches massive settlement with retail giant
The Federal Trade Commission announced Thursday, September 25th, they've reached a settlement with Amazon over what the Feds called deceptive business practices concerning Prime Memberships.
It stems from a 2023 FTC complaint against the company, over alleged deceptive enrollment and cancellation practices. These practices made it easier to 'accidentally' enroll in Prime, and not realize it, then receive an increased bill, currently, Prime memberships are $15 a month.
According to Geekwire, the FTC says Amazon employed what are called "confusing" checkout flows, and deceptive user interfaces, trying to prod users into a Primer membership they didn't expect. Not long ago, a Seattle-area judge ruled that Amazon was guilty of collecting payment information before disclosing full Prime membership terms.
According to Geekwire:
"The settlement forces Amazon to redesign Prime’s enrollment interface — requiring clearer disclosures and a “clear and conspicuous button” to decline Prime. Amazon cannot have a button that says, “No, I don’t want Free Shipping.”
Amazon says many of the changes they are required to make in the settlement have already been put into practice. The settlement fine is $1 billion dollars, and another $1.5 billion will be sent to about 35 million customers who are eligible.
Amazon doesn't reveal exact numbers, but it's estimated there are at least 197 million people who have a Prime membership as of March of this year. Overall,.the value of Amazon, or market capitalization, is said to be about $2.4 trillion.
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