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 Federal Trade Commission (FTC) lawsuit that alleged the company used ‘dark patterns’ to manipulate customers into signing up for its Prime membership program.

The lawsuit, filed in July 2021, alleged that Amazon made it difficult for customers to cancel their free trial memberships, leading to unexpected charges on their credit cards.

The settlement, announced today, requires Amazon to pay $2.5 billion in restitution to affected customers, as well as make changes to its online shopping experience to make it easier for customers to cancel their Prime memberships.

Amazon has denied any wrongdoing in the case, but agreed to settle to avoid a lengthy legal battle with the FTC.

FTC Chair Lina Khan called the settlement a “victory for consumers,” noting that it sends a strong message to other companies that use deceptive practices to boost their profits.

Amazon has also agreed to implement new compliance measures to prevent similar issues from occurring in the future.

The settlement is one of the largest ever reached between the FTC and a tech company, and highlights the growing scrutiny that big tech firms face over their business practices.

Amazon’s stock price dropped slightly on the news of the settlement, but analysts expect the company to quickly rebound from the financial hit.

Overall, the settlement is seen as a win for consumer rights advocates and a wake-up call for Amazon and other tech companies to prioritize transparency and ethical business practices.