Amazon to refund $2.5 billion in Prime settlement
Amazon plans to refund millions of dollars after settling an FTC lawsuit over Prime membership and cancellation issues.
- In September, the FTC announced a $2.5 billion settlement with Amazon over millions of consumers who felt tricked into signing up for Prime memberships and struggled to stop the fees.
- Amazon is currently sending out claim notices as part of a major settlement with the Federal Trade Commission.
- The Federal Trade Commission has warned that scammers are trying to get in on the act. Be careful how you react.
If you haven’t yet received your Amazon refund as part of its settlement with federal regulators, you may have a little work to do in the new year.
Here are the important points. Amazon is currently sending out claim notices, but the Federal Trade Commission warns that scammers are trying to interfere with this action. Be careful how you react.
In September, the FTC announced a $2.5 billion settlement with Amazon for allegedly deceiving tens of millions of consumers into signing up for its popular Prime membership and making it “extremely difficult” for them to stop being billed for the subscription service.
Under the settlement, eligible Prime members will receive a refund of up to $51 for their Amazon Prime subscription. Refunds will take into account the amount of Amazon Prime membership fees paid during the consumer’s subscription period.
What exactly was the Amazon Prime incident?
The FTC explained that Amazon created an online checkout process that gave consumers several opportunities to subscribe to Amazon Prime for $14.99 per month.
According to a 2023 FTC statement, “the primary purpose of Prime’s cancellation process was to shut down subscribers, not allow them to cancel.”
“Evidence shows that Amazon uses sophisticated subscription traps designed to manipulate consumers into signing up for Prime and makes it extremely difficult for them to terminate their subscriptions,” FTC Chairman Andrew Ferguson said in a September statement.
According to the FTC, in many cases it was more difficult to find options to complete purchases without subscribing to Prime.
According to the FTC, “In some cases, the button consumers were presented with to complete the transaction did not clearly state that by selecting that option, they were also agreeing to participate in the Prime subscription.”
When did some customers start receiving refunds?
After the settlement was reached, Amazon issued automatic refunds to affected Prime members in November and December of last year. Amazon was to automatically distribute payments to all eligible consumers within 90 days.
Essentially, eligible U.S. consumers would automatically receive a refund if they used Amazon Prime benefits three or fewer times in the 12-month period between June 23, 2019 and June 23, 2025. (According to the court order, the benefits referred to here do not include “free expedited shipping if the transaction in question would have received free shipping speeds without an Amazon Prime subscription membership.”)
Who can file a claim now?
The second phase of the claims process is currently underway. If you receive an automatic payment, you cannot make a claim.
If you are eligible, you must submit an application to receive the money. Consumers need to check whether they unintentionally signed up for Amazon Prime during the six-year period. You can also explain if you tried to cancel but were unsuccessful.
According to a court order filed on September 25, 2025, these consumers who wish to make a claim must submit their claim form to Amazon via email, first class prepaid mail, or payment website within up to 180 days after receiving the claim form.
In January 2026, Amazon began sending bill notifications to eligible Prime members who did not receive automatic refunds. The claim notice you receive will provide instructions on how to file your claim.
U.S. consumers are eligible for claims processing if:
- Sign up for Amazon Prime between June 23, 2019 and June 23, 2025.
- redeemed 3 or more but less than 10 Prime benefits in the 12-month period from June 23, 2019 to June 23, 2025, and
- Either you were unintentionally registered through the so-called “Registration by Dispute flow” or you tried to cancel through the online cancellation flow but were unable to cancel.
Determine how you will receive your cash on the claim form. Check, PayPal, or Venmo.
FTC warns to beware of Amazon scammers
The FTC warns at the top of its website that the independent federal agency will not call or otherwise contact consumers to offer cash refunds in Amazon settlement cases.
“If you receive a call from someone claiming to be from the FTC, it is a scam,” according to the alert. The FTC recommends reporting such scams at ReportFraud.ftc.gov.
“And no one at Amazon will ever ask for money for a refund,” the FTC said. “Only scammers say they can offer special access or a money-back guarantee.”
Amazon has not yet announced a mailing date for when people who filed claims will receive their money. However, Amazon is not expected to make these payments until late 2026.
If you took advantage of Amazon Prime’s long list of benefits once you signed up, you are not eligible to claim this refund, whether or not you felt cheated.
The FTC says consumers who need assistance with payment or claim forms should contact Amazon via email at admin@SubscriptionMembershipSettlement.com.
What is the so-called challenge registration flow? Great question. The FTC says it’s okay to not know exactly whether you’ve fallen into such a trap.
The FTC says Amazon will complete its analysis.
According to the court order, consumers may have signed up for unwanted subscriptions through various locations on Amazon’s website, including the “universal Prime decision page, delivery option selection page, Prime Video registration flow, or single-page checkout.”
As part of the settlement, Amazon will pay $1.5 billion in refunds to eligible customers and an additional $1 billion in civil penalties. Amazon did not admit or deny the allegations as part of the settlement. Amazon agreed to make some changes to the website.
Amazon said in a statement posted online in September 2025 that the company and its executives “always follow the law.”
“This settlement allows us to move forward and focus on innovation for our customers. We are working very hard to make it clear and easy for our customers to both sign up for and cancel their Prime membership,” the company said.
Consumers can obtain more information about Amazon Payments at www.SubscriptionMembershipSettlement.com. For the latest information, see ftc.gov/Amazon.
Contact personal finance columnist Susan Tompol: stompor@freepress.com. follow himr X @tompor.
