Amazon Faces FTC Trial Over Alleged Prime Membership Deception

Amazon is on trial after U.S. Federal Trade Commission (FTC) attorneys accused the company of knowingly enrolling millions of customers into Prime without clear consent. The civil antitrust case, targeting Amazon and three executives, could lead to hundreds of millions in damages and fines of up to $53,000 per violation.

According to the FTC, Amazon designed its Prime sign-up and cancellation processes to maximize revenue at the expense of consumers. Attorney Jonathan Cohen told jurors that “more members, more money” was Amazon’s priority, even if customers did not want the subscription.

Prime costs $14.99 per month and offers benefits such as free shipping and streaming. However, the FTC claims Amazon lured shoppers with free trial offers without clearly disclosing that these automatically convert into paid memberships. Internal emails revealed that executives rejected design changes between 2017 and 2022 that would have clarified terms, fearing reduced sign-ups.

The FTC also highlighted Amazon’s so-called “Iliad flow,” a cancellation process requiring up to seven clicks, which misled customers into thinking they had already ended their subscription. Data showed tens of millions abandoned the process midway.

Amazon attorney Moez Kaba denied wrongdoing, arguing Prime’s terms were disclosed and cancellations were simple. He accused the FTC of misrepresenting evidence and insisted the law does not demand a “well-promoted or popular” cancellation method.

The trial, expected to last a month, will feature testimony from customers and Amazon employees. A judge has already ruled Amazon violated the Restore Online Shoppers’ Confidence Act (ROSCA) by collecting payment data before fully disclosing terms. This early ruling gives the FTC a strong position as it seeks to hold Amazon and its executives liable.