FTC sues Amazon, alleging users are being tricked into signing up for Prime
Amber Neely
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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17 Comments
I am glad FTC finally comes to regulating that all web services must have accessible "cancel" plans.
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.
Articles like this are what keep me coming back to AppleInsider. The general tech reporting is so straightforward and no-nonsense.
The easiest way to cancel is probably just changing your credit card number.
What needs to be looked into is Amazon't return policies, namely how long it takes to get a refund. The refund time varies depending on the cost of the item being returned. Items over $300. (according to Amazon support) take 30 days whereas lesser expensive items generally take 3 - 5 days. I'd like to know how much Amazon profits from holding its customers' money. I'd speculate the interest alone on this money is in the millions if not billions. Nowhere in Amazon's policies is there any mention of this (again verified by Amazon support themselves)!
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).
They certainly tricked me. On the way to completing an order, there was a radio button selected for free shipping. Because my order qualified for free shipping, I left it and moved to the rest of the ordering procedure. But that button was for Prime Free shipping - which would arrive 1 day earlier than the usual Free shipping. AND - leaving that button selected automatically signed me up for Prime!
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?