Amazon duped millions of consumers into enrolling in Prime: US watchdog
The US Federal Trade Commission sued Amazon.com Inc. Wednesday, alleging the e-commerce giant duped consumers into signing up for its Prime membership service and deliberately made it hard to cancel.
The consumer protection agency filed a lawsuit in Washington state federal court claiming that Amazon’s website manipulates users into enrolling in Prime, where subscribers pay $139 a year for privileges like speedy free delivery, video streaming and access to 100 million songs.
The cancellation process for Prime is also difficult to find and requires multiple steps, the FTC alleged. The agency said Amazon referred to the process internally as the Iliad, after Homer’s lengthy epic poem.
In its complaint, the FTC said consumers must click through five pages on the desktop web store or six on the mobile app to cancel Prime. It also claimed Amazon failed to turn over information sought by investigators, taking more than 18-months to produce materials the FTC sought.
The FTC said Amazon’s tactics violate a 2010 consumer protection law designed to protect online shoppers.
About 167 million Amazon shoppers had Prime memberships as of March, unchanged from a year earlier, according to Consumer Intelligence Research Partners.
“Amazon tricked and trapped people into recurring subscriptions without their consent, not only frustrating users but also costing them significant money,” FTC Chair Lina Khan said in a statement.
The suit is the third the FTC has filed against Amazon in the past month. The company agreed to pay $30.8 million to settle allegations that it failed to delete data about kids collected by its Alexa speakers and that its Ring doorbells and cameras illegally spied on users.
Amazon said it disagreed with the FTC’s allegations but agreed to settlements to resolve the cases.