Synopsis: The Federal Trade Commission (FTC) reached a $2.5 billion settlement with Amazon over allegations of “deceptive” tactics used to trap consumers in Prime subscriptions.
-While $1 billion serves as a civil penalty, $1.5 billion is allocated for consumer refunds, capped at $51 per person.
-Automatic refunds were distributed in late 2025, but eligible customers who missed out can now file a claim for payments arriving in late 2026.
-Former FTC Chair Lina Khan criticized the deal as a “drop in the bucket” for the $2.6 trillion tech giant, arguing it allowed executives to “pay their way out” of a jury trial.
Amazon Might Owe You A Check
Last September, the Federal Trade Commission announced that it had reached a $2.5 billion settlement with Amazon, after the agency had alleged that the e-commerce giant had “used deceptive methods to sign up consumers for Prime subscriptions and made it exceedingly difficult to cancel.”
As a result of the settlement, which was announced shortly after the start of a jury trial, Amazon agreed to pay a $1 billion civil penalty and to provide $1.5 billion in refunds to consumers who had been harmed, and to cease the activities in question.
“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,” FTC Chairman Andrew N. Ferguson said in the September announcement.
“The evidence showed that Amazon used sophisticated subscription traps designed to manipulate consumers into enrolling in Prime, and then made it exceedingly hard for consumers to end their subscription. Today, we are putting billions of dollars back into Americans’ pockets and making sure Amazon never does this again. The Trump-Vance FTC is committed to fighting back when companies try to cheat ordinary Americans out of their hard-earned pay.”
The FTC action dated back to the Biden Administration in 2023, under then-FTC Chair Lina Khan, an anti-monopoly crusader whose journal article, “Amazon’s Antitrust Paradox,” first put her on the map as an academic. The action was taken under the Restore Online Shoppers’ Confidence Act (ROSCA), and, per the current FTC, it is the third time the FTC has obtained a civil penalty under ROSCA.
How The Refunds Work
According to the FTC’s page, the refunds will be issued in two stages: ” (1) an automatic refund process for eligible Prime customers; and (2) a claims process for eligible Prime customers who didn’t get an automatic refund.”
The refunds are capped at $51. The automatic refunds were sent to Amazon customers in November and December of last year. Amazon is currently sending claims notices to eligible customers, with the payments set to arrive in late 2026. Those seeking a claim form are asked to email [email protected].
Per the FTC, customers are eligible to apply for a refund if they meet any of the following:
“You are an Amazon Prime customer in the United States; You signed up for an Amazon Prime subscription through a “challenged enrollment flow” or tried to cancel through the online cancellation flow but were unable to do so between June 23, 2019 and June 23, 2025; [and] You used no more than three (3) Amazon Prime Benefits (including Prime Music or Prime Video products offered for free to Prime subscribers) in any 12 months following Amazon Prime enrollment.”
Those affected can choose to receive their payment via check, PayPal, or Venmo.
Scam Alert
However, like with most things these days, scams related to the settlement have begun to proliferate.
The FTC website makes clear that “the FTC is not contacting people about refunds in the Amazon matter. If you get a call from someone who claims to be from the FTC, it’s a scam.” Those who receive such calls are asked to report the matter to the FTC’s fraud website.
“A Drop in the Bucket”
Questions have been raised about that settlement. While $2.5 billion is, by any standard, a lot of money, it isn’t all that much money to Amazon. The company, as of Wednesday morning, has a market cap of $2.6 trillion.
Among those expressing concern about the size of the settlement was Lina Khan, the Amazon critic who led the FTC in the Biden Administration and brought the original suit.
“In 2023, we sued Amazon and several top executives for tricking people into Prime subscriptions and then making it absurdly difficult to cancel,” Khan wrote on X after the settlement was announced in September. “This week marked the start of a historic jury trial, where American citizens would hear details of Amazon’s business practices and determine if it had broken the law.”
“A couple of days into trial, FTC announces it has settled all charges, rescuing Amazon from likely being found liable for having violated the law and allowing it to pay its way out,” the former FTC chair continued. “A $2.5 billion fine is a drop in the bucket for Amazon and, no doubt, a big relief for the executives who knowingly harmed their customers.”
The other FTC lawsuit against Amazon, over antitrust claims, remains active, although a planned trial has been delayed until March 2027.
Trump and Bezos
During his first presidency, Donald Trump was often at odds with Amazon founder Jeff Bezos. Trump feuded with the Bezos-owned Washington Post, the Trump-allied National Enquirer broke embarrassing stories about Bezos’ personal life, and the Trump Administration awarded a major Pentagon cloud contract to Microsoft rather than Amazon, leading to a lawsuit from Amazon.
However, in the second Trump era, he and Bezos have become much chummier, as have many titans of the tech industry who have chosen to cozy up to the president. Bezos stepped down as Amazon’s CEO in 2021, but remains the executive chair and the company’s largest shareholder.
Back in February, Axios reported about how Trump and Bezos went from enemies to friends. Key moments included Bezos killing a Washington Post editorial endorsing Kamala Harris for president, putting new guidelines in place for the newspaper’s editorial page, the two men having dinner together at Mar-a-Lago, and Bezos attending Trump’s second inauguration, to which Amazon donated $1 million.
This spring, Amazon briefly planned to display the amount Trump’s tariffs had added to product prices on its website. However, CNN reported that a phone call from Trump persuaded Bezos to drop the displays.
“Jeff Bezos was very nice. He was terrific,” Trump told reporters after this episode, CNN said at the time. “He solved the problem very quickly. Good guy.”
About the Author: Stephen Silver
Stephen Silver is an award-winning journalist, essayist, and film critic, and contributor to the Philadelphia Inquirer, the Jewish Telegraphic Agency, Broad Street Review, and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. For over a decade, Stephen has authored thousands of articles that focus on politics, national security, technology, and the economy. Follow him on X (formerly Twitter) at @StephenSilver, and subscribe to his Substack newsletter.
