Amazon has begun sending refunds to Prime customers as part of a $2.5 billion settlement with the Federal Trade Commission, which accused the company of tricking millions of people into signing up for its subscription service and making it unnecessarily difficult to cancel.
The agreement, one of the largest consumer protection settlements in the FTC's history, includes $1 billion in civil penalties and $1.5 billion set aside for consumer refunds. Payments began going out this month and will continue through late December.
The refunds apply to customers who signed up for Prime between June 2019 and June 2025 through enrollment flows the FTC said were deceptive. Amazon allegedly used design tactics that nudged customers into subscribing without clear consent and buried cancellation options behind multiple screens and prompts.
Under the terms of the settlement, most eligible customers will receive refunds automatically through PayPal or Venmo. Those who do not accept the payment within 15 days will receive a check in the mail at the address associated with their Amazon account. Checks must be cashed within 60 days. The maximum refund per customer is $51 — roughly the cost of several months of Prime membership for many subscribers.
Customers who are not part of the automatic refund group will be notified in early 2026 and asked to submit a claim. They will have 180 days to complete the form. Amazon will then review and process refunds within 30 days.
As part of the settlement, Amazon must overhaul Prime enrollment and cancellation. The company is now required to clearly disclose subscription costs, renewal terms and cancellation instructions up front. It must also allow customers to cancel Prime through the same method they used to sign up.
The FTC will appoint an independent monitor to ensure Amazon complies with the new requirements.
The settlement follows years of scrutiny over so-called "dark pattern" design tactics used across the tech industry. Regulators say such designs are intended to steer users toward decisions that benefit companies at the expense of consumer choice.
Amazon has denied wrongdoing but said the settlement allows it to move forward and make improvements to the customer experience.
Refunds are expected to reach millions of Prime members nationwide.
Originally published on IBTimes
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