Washington — The Federal Trade Commission announced a landmark $2.5 billion settlement with Amazon.com Inc. and executives Neil Lindsay and Jamil Ghani on September 25, 2025, addressing allegations that the company enrolled millions in Prime subscriptions without consent and deliberately complicated cancellations. The agreement, filed in U.S. District Court for the Western District of Washington, includes a $1 billion civil penalty — the largest ever for an FTC rule violation — and $1.5 billion in consumer refunds, the agency’s second-highest restitution award.
The FTC charged Amazon with violating the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA) by using manipulative interface designs to trick consumers into Prime memberships and creating a cumbersome cancellation process. Internal documents revealed executives acknowledged these tactics, with one calling subscription practices “a bit of a shady world” and another labeling unwanted enrollments “an unspoken cancer.”
The settlement targets an estimated 35 million affected consumers, offering up to $51 each for those enrolled without consent or unable to cancel between June 23, 2019, and June 23, 2025. Refunds will be processed automatically within 90 days via an Amazon-managed website, with eligibility tied to minimal use of Prime benefits beyond shipping.
“Today, the Trump-Vance FTC made history and secured a record-breaking, monumental win for the millions of Americans who are tired of deceptive subscriptions that feel impossible to cancel,” said FTC Chairman Andrew N. Ferguson. “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. Today, we are putting billions of dollars back into Americans’ pockets, and making sure Amazon never does this again.”
The settlement mandates Amazon overhaul its Prime processes: a clear “Decline Prime” button must replace vague prompts, and enrollment must include transparent disclosures about costs, charge frequency, auto-renewal, and cancellation steps. Cancellations must be as simple as sign-ups, using the same method — app or website — without added costs or delays. An independent third-party will monitor compliance, ensuring redress distribution and adherence to reforms, which bind Amazon for 10 years and the executives for three.
The case, only the third ROSCA enforcement to yield penalties, underscores the 2010 law’s protections against “negative option” schemes, where inaction implies consent. ROSCA requires explicit consumer consent and clear terms before charging, barring tactics like pre-checked boxes or hidden renewals. The FTC’s legal team included Jonathan Cohen, Evan Mendelson, Olivia Jerjian, Jonathan W. Ware, Sana Chaudhry, Anthony Saunders, Eli Freedman, Colin D. A. MacDonald, Rachel F. Sifuentes, and Jeffrey Tang. The 3-0 commission vote approved the stipulated order, which awaits court approval to gain legal force.
Amazon’s response emphasized compliance, with spokesperson Mark Blafkin stating the company and executives followed the law, noting that many required changes were already implemented to simplify Prime processes. The program, serving millions with benefits like free two-day shipping, remains a key shopping tool, and the settlement, while significant, represents a fraction of Prime’s 2024 revenue.
The FTC’s action aligns with broader efforts to curb manipulative tactics, known as “dark patterns,” in online subscriptions. ROSCA complements the FTC Act’s ban on unfair practices and the Telemarketing Sales Rule’s safeguards, ensuring sellers obtain billing details directly and disclose terms upfront. Consumers can report issues at ReportFraud.ftc.gov, reinforcing protections against subscription pitfalls nationwide.