US FTC sues Amazon for 'knowingly duping' customers to sign up for Prime

Washington, June 22

The US Federal Trade Commission (FTC) has sued e-commerce giant Amazon over alleged 'deceptive' tactics to sign up customers for its Prime service.

The complaint, filed in the federal court in the US city of Seattle, said that for years, Amazon has "knowingly duped millions of consumers into unknowingly enrolling in its Amazon Prime service".

"Specifically, Amazon used manipulative, coercive, or deceptive user-interface designs known as 'dark patterns' to trick consumers into enrolling in automatically-renewing Prime subscriptions," read the FTC complaint.

Amazon Prime costs $139 per year and gives consumers access to free two-day shipping, along with access to Prime Video and music streaming.

"Amazon tricked and trapped people into recurring subscriptions without their consent, not only frustrating users but also costing them significant money," FTC Chair Lina M. Khan said in a statement.

"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," she added.

During Amazon's online checkout process, consumers were faced with numerous opportunities to subscribe to Amazon Prime at $14.99/month.

In many cases, the option to purchase items on Amazon without subscribing to Prime was more difficult for consumers to locate.

"In some cases, the button presented to consumers to complete their transaction did not clearly state that in choosing that option they were also agreeing to join Prime for a recurring subscription," said the FTC.

The FTC has been investigating Amazon Prime's sign-up and cancellation processes since 2021.

An Amazon spokesperson said that the FTC's claims are false on the facts and the law.

"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," the spokesperson said.

"We also find it concerning that the FTC announced this lawsuit without notice to us, in the midst of our discussions with FTC staff members to ensure they understand the facts, context, and legal issues, and before we were able to have a dialog with the Commissioners themselves before they filed a lawsuit.

"While the absence of that normal course engagement is extremely disappointing, we look forward to proving our case in court," the spokesperson added.