Amazon has agreed to pay $2.5 billion to settle allegations from the Federal Trade Commission (FTC) that it misled customers into signing up for Prime memberships without their consent. The FTC announced this settlement, which includes $1.5 billion earmarked for refunds to affected Prime subscribers, on Thursday. This settlement is one of the largest in FTC history and is seen as a significant victory against deceptive subscription practices.

The settlement comes after the FTC accused Amazon of using "dark patterns"—design techniques that manipulate users into making unintended choices. Court documents revealed that around 35 million customers who enrolled in Prime between June 2019 and June 2025 may be eligible for compensation. Those who signed up through certain promotional offers and did not fully utilize the benefits could receive up to $51 each.

As part of the agreement, Amazon will implement changes to its subscription process. This includes creating a more visible option for customers to decline Prime membership, simplifying the cancellation process, and providing clearer information about subscription terms during sign-up. Additionally, an independent third-party supervisor will be appointed to ensure compliance with these new measures.

The FTC's investigation revealed that Amazon executives had previously discussed issues related to deceptive enrollment practices, with some internal comments describing the subscription process as "shady" and acknowledging that it led to unwanted sign-ups. The FTC began its inquiry during Donald Trump's presidency, and the case was filed under Joe Biden's administration.

Despite the hefty settlement, Amazon's stock remained stable, indicating that investors were not significantly concerned. The company stated that the settlement allows it to focus on customer service and emphasized its commitment to making the subscription process clearer and simpler.

FTC Chairman Andrew Ferguson described the settlement as a monumental win for consumers, highlighting the agency's ongoing efforts to combat deceptive practices in the tech industry. While some critics argue that the settlement is insufficient given Amazon's financial power, the changes mandated by the FTC aim to protect consumers from similar issues in the future.