Despite Jeff Bezos’s attempts to stay on Trump’s good side, Amazon has agreed to pay up $2.5 billion to settle a U.S. Federal Trade Commission (FTC) lawsuit over its allegedly questionable Prime subscription practices. And the Trump administration seems more than happy to claim credit for the huge settlement.
The FTC announced today that Amazon has agreed to settle a lawsuit accusing the e-commerce giant of deceiving customers into signing up for Prime subscriptions and then making it too difficult for people to cancel their memberships with a multi-step process, in violation of FTC rules.
Under the settlement, Amazon will pay a $1 billion civil penalty—the largest ever in an FTC rule-violation case—and provide $1.5 billion in refunds to roughly 35 million consumers affected by the unwanted Prime enrollments or delayed cancellations.
Amazon will also have to make significant changes to how people join and cancel Prime memberships. Essentially, the company must make it easy for customers to opt out of signing up in the first place, and make canceling a membership just as simple as joining the program.
“Today, the Trump-Vance FTC made history and secured a record-breaking, monumental win for the millions of Americans who are tired of deceptive subscriptions that feel impossible to cancel,” said FTC Chairman Andrew N. Ferguson in a press release.
Amazon did not immediately respond to a request for comment from Gizmodo.
The news comes as Bezos, like many other tech executives, has made deliberate efforts to court Trump, including donating to his inauguration fund and joining the president at several dinners and meetings.
Bezos even reportedly shelved a plan to show the cost of Trump’s tariffs next to product prices on Amazon after getting a call from an angry Trump. The president’s press secretary, Karoline Leavitt, called the move a “hostile and political act.”
Tech executives’ attempts to court Trump have had mixed results so far, though AI leaders like OpenAI’s Sam Altman and Nvidia’s Jensen Huang have fared better.
The FTC originally filed this lawsuit against Amazon in 2023, under Biden’s FTC Commissioner Lina Khan.
The commission argued that Amazon used confusing language to trick people into starting a Prime trial, offering free shipping at checkout without clearly explaining that the trial would automatically renew as a paid subscription after 30 days.
Since then, it says it has discovered documents that revealed executives and employees had discussed the company’s deceptive Prime enrollment and cancellation practices. One comment found in the docs said that “subscription driving is a bit of a shady world,” and another said that steering consumers to unwanted subscriptions is “an unspoken cancer.”
Prime memberships, which cost $139 a year or $14.99 a month and include perks like free shipping and the company’s video streaming service, generate billions for Amazon. It pulled in $12 billion from these subscriptions during its most recent quarter.
It’s unclear what this settlement means for Amazon’s larger FTC case, in which the company is accused of stifling e-commerce competition. The company won a partial dismissal, but the trial is scheduled for 2027.
