FTC accuses Amazon of illegal practices related to Prime subscriptions

Key takeaways

  • The FTC accused Amazon of tricking customers into signing up for Prime subscriptions and making it difficult to cancel.
  • Regulators said the actions by Amazon were costing consumers “significant sums”.
  • The FTC asked the court to compel Amazon to stop the practices and pay a fine.

US regulators have filed a lawsuit against Amazon (AMZN) on Wednesday, saying the online retailer had engaged in a years-long effort to trick customers into signing up for its Prime membership without their consent, and that it was their difficult to cancel subscriptions.

The Federal Trade Commission (FTC) said the company used “manipulative, coercive, or deceptive user interface designs known as 'dark patterns' to trick consumers into signing up for Prime memberships. automatically renewing”.

He also accused Amazon of complicating the process for Prime subscribers to cancel their membership, and that company officials slowed down or rejected changes that would have facilitated this because those changes would have “negatively affected business results.” ;Amazon”.

FTC Chairwoman Lina Khan said Amazon “cheated and tricked people into recurring subscriptions,” which both frustrated users and cost them “significant sums.” She added that these “manipulative tactics” hurt consumers and law-abiding businesses.

The FTC asked the court in the Western District of Washington to force Amazon to cease the practices and award damages. Amazon did not immediately respond to the complaint.

The legal challenge came on on the same day, Amazon announced its popular “Prime Day” sale would take place on July 11 and 12.

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Source: investopedia.com

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