Amazon is paying out $1.5 billion to Prime customers as part of a $2.5 billion settlement with the Federal Trade Commission over allegations of deceptive Prime subscription practices, including making cancellations difficult and misleading enrollment buttons.

Amazon denies wrongdoing, claiming it clearly explains Prime's terms and offers simple cancellation options, but the FTC argues the company deliberately made cancellations challenging and used misleading enrollment buttons.

The lawsuit originated from allegations that Amazon tricked customers into signing up for Prime and made cancellations difficult, violating the Restore Online Shoppers’ Confidence Act.

Eligible customers who signed up for Prime between June 23, 2019, and June 23, 2025, and used four or fewer Prime benefits over six years, including unsuccessful cancellation attempts, may receive up to $51 depending on their usage.

Customers who used no more than 10 Prime benefits in their first year could also claim payouts, with amounts potentially up to $51, subject to adjustments.

Those who tried unsuccessfully to cancel or accepted offers to keep their Prime subscriptions are also eligible for payments.

Customers who used Prime three or fewer times over any 12-month period and signed up through certain enrollment flows will receive automatic refunds, with payments expected by December 25, 2025.

Customers who do not qualify for automatic payments can file claims between January 23, 2026, and July 23, 2026, through a third-party claims administrator.

Automatic payments will be sent by December 24 to customers who used Prime three or fewer times over any 12-month period, without needing to file a claim.

Prime, costing $139 annually or $14.99 monthly, offers benefits like faster shipping and streaming, with over 200 million members generating more than $12 billion in recent subscription revenue.

Amazon states it has always complied with the law and has made efforts to clarify and simplify the sign-up and cancellation processes, asserting transparency and ongoing improvements.

The FTC initiated the case two years ago, citing over a decade of alleged violations including misleading enrollment and cancellation practices.

The FTC's lawsuit, filed two years ago, accused Amazon of violating laws designed to ensure transparency about charges, including the Restore Online Shoppers’ Confidence Act, which Amazon denies violating.