Amazon has agreed to pay $2.5 billion in fines and reimbursements to settle allegations by the U.S. Federal Trade Commission (FTC) that it misled millions of customers into signing up for its Prime membership program. The deal, announced Thursday, includes a $1.5 billion fund to reimburse subscribers and a $1 billion civil penalty.
According to Reuters, around 35 million Prime members will be eligible for payouts, with many set to receive automatic payments of $51 if they enrolled through certain offers between mid-2019 and mid-2025 and rarely used the service. Others who struggled to cancel during that period will be able to file claims for compensation.
A record settlement, but limited impact on Amazon
The FTC hailed the resolution as one of its largest consumer restitution cases ever. Chair Andrew Ferguson described it as “a monumental win for millions of Americans who are tired of deceptive subscriptions that feel impossible to cancel.” Still, the settlement represents less than two days of Amazon’s typical revenue, underscoring how little financial pain it is likely to cause the company.
Court filings revealed internal discussions among Amazon executives describing subscription tactics as “a bit of a shady world” and calling unwanted sign-ups “an unspoken cancer.” The FTC alleged that, for years, executives rejected changes that would have made it easier for consumers to understand or cancel Prime, only introducing reforms in 2022 as regulators intensified scrutiny.
Under the agreement, Amazon will introduce a clear opt-out button during sign-up, simplify the cancellation process, and hire an independent monitor to oversee compliance. The company emphasized that most of these changes were already in place, saying the settlement allows it to “move forward and focus on customers.”
Launched in 2005, Prime has grown into one of Amazon’s most powerful businesses, generating nearly $24 billion in subscription revenue in the first half of 2025 alone. Analysts say the settlement is unlikely to dent the program’s dominance. As one industry expert told Reuters, Prime remains “deeply entrenched in most American households,” even as Amazon makes it easier to walk away.
