Amazon Reaches $2.5B Settlement With FTC Over Prime Subscription Scandal

Amazon just got hit with a record-breaking $2.5 billion settlement after the Federal Trade Commission accused the company of tricking millions of Americans into paying for its Prime subscription through shady, manipulative tactics and then making it next to impossible to cancel.

The deal, announced Thursday, includes:

• $1 billion in civil penalties

• $1.5 billion in consumer refunds

• A mandate to stop using deceptive subscription methods

The case marks a major win for the Trump-Vance FTC, signaling a renewed focus on holding Big Tech accountable after years of unchecked growth, manipulation, and political bias. FTC Chairman Andrew Ferguson didn’t hold back.

“Amazon used sophisticated subscription traps designed to manipulate consumers into enrolling in Prime,” Ferguson said. “And then made it exceedingly hard for consumers to end their subscription.”

This lawsuit, originally filed in 2023, zeroed in on what tech insiders call “dark patterns” design tricks meant to confuse users, hide cancellation options, or push them into decisions they might not have otherwise made. Amazon, for all its talk of customer obsession, was allegedly using misleading interfaces and delay tactics to keep customers locked into paid Prime memberships, even after they attempted to cancel.

Translation: Amazon was making it easier to spend your money than to stop them from taking it.

And while $2.5 billion may sound like a serious penalty, it’s a mere drop in the bucket less than 1% of Amazon’s 2024 revenue, which topped $575 billion. That fact wasn’t lost on Sen. Elizabeth Warren, who admitted the FTC’s move was “not enough,” yet still tried to spin it as a failure of the Trump administration even though it was Trump-era leadership that delivered the blow.

“This settlement fails to hold Amazon executives accountable... it risks incentivizing future lawbreaking,” Warren claimed.

But Warren’s concern is misplaced. The real issue is how far Big Tech companies like Amazon will go to exploit their dominance, all while claiming to be champions of innovation and consumer choice. Amazon isn’t just a convenient store it’s an economic octopus that reaches into your wallet, your home, and now, your data.

And this isn’t the only storm on the horizon. Amazon is still facing another massive antitrust lawsuit from the FTC, set to go to trial in 2027. That case will challenge Amazon’s monopoly power more broadly something critics have argued for years has stifled competition and crushed small businesses.

In response to the Prime settlement, Amazon issued the usual Big Tech boilerplate: We did nothing wrong, we’re just settling so we can “move forward.”

“We work incredibly hard to make it clear and simple for customers to both sign up for or cancel their Prime membership,” said Amazon spokesperson Mark Blafkin.

But that statement directly contradicts what millions of Prime members experienced and what the FTC proved in court. Consumers weren’t cancelling because the service was bad. They were trying to cancel and getting blocked at every turn.

This settlement doesn’t just signal a rare win against Big Tech it shows what’s possible when leadership is willing to confront corporate giants, not coddle them. It’s also a reminder that deceptive business practices aren't just shady they're systemic, and unless reined in, they'll continue to harm American families under the guise of “convenience.”

The fight to restore honesty, competition, and fairness to the tech economy is far from over. But this is a step in the right direction.

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