Amazon to Pay $2.5 Billion in Landmark FTC Settlement Over Prime Misleading Practices

Washington, October 21, 2025: Amazon has agreed to pay $2.5 billion to settle a lawsuit filed by the U.S. Federal Trade Commission (FTC), which accused the e-commerce giant of misleading millions of users into enrolling — and remaining — in its Amazon Prime subscription service. The FTC described the settlement as “historic,” calling it one of the largest consumer protection settlements in the agency’s history, according to USA Today.

The FTC had sued Amazon in 2023, alleging that the company used “deceptive website designs” to nudge users into signing up for Prime memberships they didn’t intend to purchase, and then made cancellation deliberately difficult. The agency said Amazon’s design strategy — often referred to as “dark patterns” — caused many users to pay for unwanted subscriptions or face hurdles in ending them.

Under the settlement, $1 billion will go toward civil penalties, while $1.5 billion will be distributed as refunds to affected customers, The Independent reported. The trial had already begun in Seattle before Amazon chose to settle.

Amazon, however, has denied any wrongdoing. Company spokesperson Mark Blafkin stated that executives “have always followed the law” and maintained that the company aims to make it “clear and simple” for customers to manage their memberships. As part of the deal, Amazon has agreed to revise its website interface to ensure better clarity during sign-ups and cancellations.

Who is eligible for a refund?

Customers who enrolled in Amazon Prime between June 23, 2019, and June 23, 2025, are eligible for refunds if they either:

Tried but failed to cancel their subscription, or

Signed up through specific “challenged” web pages, such as the Single Page Checkout or Prime Video enrollment flow.


Refunds will depend on how much each customer paid in Prime fees, with a maximum payout of $51 per person, according to court documents.

How to receive your refund

Customers who used Prime benefits three times or fewer in any 12-month period will automatically receive payments by December 24, 2025. Others will receive claim instructions from an independent administrator by January 23, 2026, with the claim deadline set for July 23, 2026.

FTC Chair Andrew Ferguson hailed the ruling as a “monumental win for consumers,” adding that it ensures Amazon “never uses these deceptive tactics again.”