The Federal Trade Commission has sued Amazon for allegedly tricking millions of consumers through its Prime sign-up and cancellation procedures.
The e-commerce giant is accused of violating the FTC Act and the Restore Online Shoppers’ Confidence Act.
The agency claims Amazon utilized design tactics known as “dark patterns” to manipulate users into enrolling in Prime without their consent and obstructing their attempts to cancel.
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FTC Chair Lina Khan said: “Amazon tricked and trapped people into recurring subscriptions without their consent, not only frustrating users but also costing them significant money.”
Amazon’s spokesperson, Heather Layman said: “The truth is that customers love Prime, and by design we make it clear and simple for customers to both sign up for or cancel their Prime membership.“As with all our products and services, we continually listen to customer feedback and look for ways to improve the customer experience, and we look forward to the facts becoming clear as this case plays out.”
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The FTC had been investigating Amazon’s Prime sign-up and cancellation processes since March 2021.
Disagreements between Amazon and the FTC escalated when the agency sought testimonies from CEO Andy Jassy and founder Jeff Bezos regarding the company’s Prime practices.
Amazon argued against the request, deeming it unduly burdensome, but the FTC rejected their objection.
Initially launched in 2005, Amazon Prime has gained immense popularity worldwide, amassing over 200 million members globally.
The subscription service, priced at $139 per year, offers various benefits, including free shipping and access to streaming content, and has generated substantial revenue for Amazon over the years.
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The suit, filed in the US District Court for the Western District of Washington, alleges Amazon deliberately impeded changes that would have simplified the cancellation process for users.
The complaint says these “adversely affected Amazon’s bottom line.”
Amazon has also allegedly made it challenging for consumers to purchase on its site without Prime.
Moreover, the wording on the transaction completion button did not make it clear users were also subscribing to Prime for a recurring fee.
The FTC claims Amazon’s cancellation process was intentionally designed to be complex and discouraging.
