FTC sues Amazon, alleging users are being tricked into signing up for Prime
The Federal Trade Commission has sued Amazon for tricking customers into signing up for Prime, only to make it exceedingly difficult to cancel those subscriptions when no longer wanted.
The suit, filed on Wednesday, says that Amazon had enrolled millions of customers into the paid subscription service without their consent. When customers attempted to cancel Prime, they faced a multi-step process designed to be deliberately difficult.
The FTC notes that Amazon used the term "Iliad Flow" to describe the cancellation process, referencing Homer's epic poem about the Trojan War.
Preventing users from easily unsubscribing would be financially beneficial to Amazon, as it generates $25 billion from Prime subscriptions annually.
"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 seen by Reuters.
Amazon Prime costs $139 per year in the United States and has more than 200 million members worldwide.
In March, the Federal Trade Commission announced plans make it easier to cancel subscriptions anywhere on the web, easing the burden on customers who may not wish to use a service anymore.
Currently, there is no standardization for subscription cancellation processes. As a result, customers may be expected to follow lengthy, multi-step cancellation processes, be forced to call a company, or even be expected to cancel a service in person.
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Comments
myfico . com is notorious for not letting you cancel, requiring you to call them. Same with banks.
That has to stop. If a person starts a subscription or opens an account, there MUST be a way for them to cancel it online, without calling.
I asked to have Amazon's legal department contact me or I'd take this up with the CFPB (Consumer Financial Protection Bureau). Of course "too big to give a damn" Amazon did not contact me.
Has anyone else noticed this and / or complained to Amazon (complaining will not get your refund any sooner, just a statement acknowledging the 30 day wait).
Now to be fair, the signup was for a 30-day trial. But I was going to be out of the country and, amazing but true, wouldn't be using Amazon within those 30 days. So I called to have the Prime status canceled and asked if the 30-day offer could be reset so I could consider it on my return. It could not.
Trust is a fragile thing. I'm sure the marketing department considers themselves very clever. And I'd expect they have statistics showing their antics glean more new customers than they lose. After all, who are you going to buy from if not Amazon?
The sad thing is that it took so long for the FTC to notice this issue and take action.
I wonder how the third party App stores will behave? and will the FTC take responsibility for policing them for malware, criminal activity and issues like this?
Ex: 2 months ago I was offered a free 30 day trial. I placed my order, set a reminder and 25 days later logged into my account and cancelled the Prime membership before it charged my card after the 30 day trial.
I suppose you have to be paying attention. And most people don't then cry victim LOL
You are correct - not really a trick as such.
The irritation is that Amazon keeps changing the way Prime is offed and thus making it possible to accidentally select it. Why should I have to make an effort to avoid Prime when I just want to pay for the product.
You are right that it can be cancelled without to much of a problem but it is not actually cancelled it just runs to the end of the promotion period and then gets cancelled.
I believe cancel should mean cancel - that is immediately, and not in 30 days (or whatever the promotion period is.
Works well.
AND you can limit your search to USA or North America or whereever - my first filter everytime!