Amazon accused of defrauding Prime customers

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By Natalie Sherman Business Correspondent, New York, Jun 21, 2023 at 16:10 GMT

Updated 42 minutes ago

Image source, Getty Images

photo caption,

More than 200 million people subscribe to Amazon Prime worldwide

The US has accused Amazon of tricking customers into signing up for auto-renewing Prime subscriptions and making it difficult to cancel.

The Federal Trade Commission (FTC), the nation’s consumer rights watchdog, made these claims in a lawsuit.

More than 200 million people globally subscribe to Prime, an Amazon subscription that offers shipping benefits, access to movie streaming, and more.

Amazon did not immediately comment.

“Amazon deceived people and trapped them into recurring subscriptions without their consent, not only frustrating users but also costing them big money,” FTC Chair Lena Khan said, announcing the lawsuit, which was filed in Seattle federal court.

The FTC said Amazon used website designs that prompted customers to agree to sign up for Prime and automatically renew a subscription while making purchases.

According to the Federal Trade Commission, Amazon has attempted to make it difficult for users to opt out of automatic enrolment because “these changes would also negatively affect Amazon’s bottom line.”

The company also allegedly put customers seeking cancellations through a grueling “four-page, six-click, fifteen-choice” process, which the FTC said is known internally as “The Iliad” in reference to the Greek epic about the “long and arduous” war. Troy”.

The FTC said the company’s tactics violated laws intended to protect shoppers.

The agency added that Amazon changed the cancellation process shortly before the lawsuit was filed.

It is seeking a court order to force Amazon to change its practices, as well as financial penalties of an unspecified amount.

Prime costs $139 annually or $14.99 per month in the US and £95 per year in the UK.

About 70% of subscribers are located in the United States, according to the Federal Trade Commission.

The FTC has repeatedly warned online companies against using “dark patterns” to manipulate shoppers.

She’s been investigating Amazon Prime since 2021.

She said the company had tried to delay the investigation on multiple occasions, including by refusing to turn over documents in a timely manner.

The lawsuit marks the FTC’s third action against Amazon in recent weeks.

The company agreed to pay $25 million last month to settle accusations of violating children’s privacy laws by keeping children’s Alexa recordings.

It agreed to pay another $5.8 million to settle allegations that Ring, which Amazon bought in 2018, violated privacy protections by giving employees unfettered access to customer videos and failed to implement safeguards against hackers.

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