"Amazon has reached a historic $2.5bn settlement with the Federal Trade Commission (FTC), which said the online retail giant tricked customers into signing up for its Prime memberships and made it difficult for them to cancel after doing so. The Seattle company will pay $1bn in civil penalties the largest such fine in the agency's history for a rule violation and $1.5bn will be paid back to consumers who were unintentionally enrolled in Prime, or were deterred from cancelling their subscriptions, the agency said on Thursday."
"FTC officials said Amazon had its back against the wall, and the consumer refund amount exceeded even the agency's expert projections. I think it just took a few days for them to see that they were going to lose. And they came to us and they paid out, said Chris Mufarrige, director of the Bureau of Consumer Protection, on the settlement negotiations."
"Amazon and our executives have always followed the law, and this settlement allows us to move forward and focus on innovating for customers, said spokesman Mark Blafkin in a statement. We work incredibly hard to make it clear and simple for customers to both sign up or cancel their Prime membership, and to offer substantial value for our many millions of loyal Prime members around the world."
Amazon will pay $2.5bn to resolve FTC claims that it tricked customers into Prime memberships and made cancellations difficult. The settlement splits into $1bn in civil penalties and $1.5bn returned to consumers who were unintentionally enrolled or deterred from cancelling. The case centered on the Restore Online Shoppers' Confidence Act, a 2010 law requiring clear online billing disclosures. The settlement was reached days after the Seattle trial began, with FTC officials saying Amazon faced likely defeat. Amazon denied wrongdoing, said it expected to win, and stated the settlement lets the company focus on customer innovation.
Read at www.aljazeera.com
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