The Federal Trade Commission of the United States lodged its lawsuit against amazon.com on Wednesday. The FTC has accused Amazon of enrolling millions of customers in its paid version and apparently did so without their consent. The lawsuit also claims that Amazon made it very difficult for consumers to cancel their subscriptions. The Trade Commission filed the suit in the Seattle Federal Court. Amazon had apparently deliberately duped consumers into unknowingly stepping into this maze.

What Did Amazon Do?

The Commission claimed that Amazon used deceptive, manipulative, and coercive interfaces to trick consumers into automatically enrolling into subscribing. These tricky interface patterns have been termed Dark Patterns. Amazon Prime services claim to offer free and fast shipping on their items along with various discounts on music, TV series, movies, and a few other benefits. If you are a Prime member, you will probably pay $139. This makes up most of Amazon’s yearly sales. 

There are more than 200 million Amazon Prime members worldwide. The Federal Trade Commission has been on this case, looking into the enrollment and cancellation methods offered by Amazon since early 2021. A consumer who attempts to cancel Prime faces a long list of problems, including multiple steps, hard to find cancellation buttons, costing them significant money.  

Leena Khan, Chairperson of the Federal Trade Commission, said, “Amazon tricked and trapped people into recurring subscriptions without their consent.”. She further stated that it was frustrating for the user and caused them financial damage.  

There has been some speculation regarding Amazon’s use of “Illiad” to describe the cancellation process. Its reference to the Trojan War or, rather, the Trojan horse-like policies has brought in further criticism.  

What Does The FTC Want?

This Federal Agency is willing to make Amazon pay in terms of civil penalties for the damage caused. It is also considering an injunction to prevent such consent violations in the future. This is one of the attempts made by the Biden administration to introduce competition back into the market. It can be interpreted as an antitrust move against big-tech firms. 

Amazon Prime has the world’s largest subscription program, with $25 billion in annual revenue. The FTC has stated that Prime is employing these dishonest practices to realize its only goal of increasing subscribers. The lawsuit by FTC also claims that even though Amazon changed its cancellation procedure in April, an average would require 5 clicks on the computer and 6 on a mobile phone to successfully cancel their subscription. 

Is Amazon Paying For Its Deception?

Following the lawsuit, Amazon shares went down by 0.9% (mid-day trading). These labyrinthine steps for cancellations, intentional misconduct, and delaying the investigation have not helped Amazon’s cause.  Earlier this year, Amazon had reached a $5.8 million settlement on charges of Amazon’s doorbell camera spying allegations.

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