FTC Sues Amazon For “Trapping” Users Into Recurring Prime Subscriptions

The US Federal Trade Commission (FTC) is suing Amazon for using “dark patterns” to trick customers into subscribing to automatically-renewing Prime subscriptions. The FTC accused Amazon of violating the FTC Act and the Restore Online Shoppers’ Confidence Act by knowingly duping “millions of customers” into signing up for Prime, all while making it unnecessarily difficult for them to cancel their subscriptions.

Since its launch in the US back in 2005, Amazon Prime has been expanded to 27 markets and it’s become a big source of revenue for the company. Over the years, the annual fee in the US went from $79 to $139, but in addition to free delivery, Amazon added various perks such as Prime Video and Prime Music to make Prime even more sticky.

“Amazon tricked and trapped people into recurring subscriptions without their consent, not only frustrating users but also costing them significant money,” said FTC Chair Lina M. Khan. “These manipulative tactics harm consumers and law-abiding businesses alike. The FTC will continue to vigorously protect Americans from “dark patterns” and other unfair or deceptive practices in digital markets.”

In detail, the FTC explained that Amazon doesn’t make it clear enough to consumers completing a transaction that they’re also agreeing to join Prime for a recurring subscription. Moreover, the FTC believes that Amazon purposefully implemented a cancellation process that discourages users to complete it, offering several offers to continue the subscription along the way.

“The complaint notes that Amazon was aware of consumers being nonconsensually enrolled and the complex and confusing process to cancel Prime that the company’s executives failed to take any meaningful steps to address the issues until they were aware of the FTC investigation,” the FTC press release said.

Ironically, this new FTC lawsuit comes on the same day Amazon announced the date of its next Prime Day event on July 11-12. Last month, the FTC had already fined Amazon $25 million for illegally keeping kid’s Alexa voice recordings.