Amazon Will Pay $2.5 Billion to Settle FTC Suit That Alleged ‘Dark Patterns’ in Prime Sign-Ups

Amazon has agreed to pay $2.5 billion to settle a lawsuit brought by the Federal Trade Commission (FTC) that alleged the company used deceptive ‘dark patterns’ to trick users into signing up for its Prime subscription service.

The lawsuit, filed in the U.S. District Court for the Western District of Washington, claimed that Amazon’s use of dark patterns violated Section 5 of the FTC Act, which prohibits unfair or deceptive acts or practices in commerce.

According to the FTC, Amazon made it difficult for customers to cancel their Prime subscriptions, misled them about the benefits of the service, and charged them without their consent.

In addition to the $2.5 billion settlement, Amazon has agreed to implement changes to its Prime sign-up process to make it more transparent and easier for customers to understand.

FTC Chair Lina Khan praised the settlement as a victory for consumers, saying that it sends a clear message that companies cannot use deceptive tactics to exploit their customers.

Amazon, while not admitting any wrongdoing, said in a statement that it was pleased to have resolved the matter and would work to ensure compliance with the law in the future.

The settlement represents one of the largest ever paid by a company to the FTC and underscores the importance of transparency and honesty in consumer transactions.

Consumer advocacy groups hailed the settlement as a step in the right direction, but some critics argue that the $2.5 billion payment is insufficient given the size and profitability of Amazon.

Going forward, it will be crucial for regulators to continue monitoring Amazon and other tech giants to ensure they are operating in a fair and ethical manner.

Overall, the settlement serves as a reminder that companies must prioritize the well-being of their customers and uphold high standards of business conduct.