FTC sues Amazon for tricking customers into paying for Prime

Amazon Prime trailer. (Image Credit: Amazon)

The U.S. Federal Trade Commission (FTC) filed a lawsuit against Amazon alleging that the e-commerce giant tricked millions of customers into enrolling in the Prime membership program that was purposefully hard to cancel.

The complaint, which was filed in federal court in Seattle, alleges that Amazon used “manipulative, coercive, or deceptive user-interface designs” to dupe consumers into enrolling in automatically renewing Prime subscriptions.

“Amazon tricked and trapped people into recurring subscriptions without their consent, not only frustrating users but also costing them significant money,” said FTC Chair Lina M. Khan. “These manipulative tactics harm consumers and law-abiding businesses alike.”

The complaint also noted that Amazon executives failed to take any meaningful steps to address the issues until they became aware of the FTC investigation.

In recent years, the FTC has ramped up its scrutiny over dark patterns to protect Americans from unfair or deceptive practices in digital markets. FTC Chair Lina Khan helped kickstart a wider debate on tech platforms’ impact on the competition after authoring a 2017 paper called “Amazon’s Antitrust Paradox.”

Amazon response: Amazon spokeswoman Heather Layman called the FTC’s claims “false on the facts and the law.” The company makes it “clear and simple” to both sign up for and cancel Prime membership Prime, Layman said.

She said that the FTC did not notify the company the suit was coming. “While the absence of that normal course engagement is extremely disappointing, we look forward to proving our case in court,” Layman said.

Amazon Prime, which costs $139 per year, offers customers access to free two-day shipping as well as access to other Amazon services like streaming TV and music.

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