Amazon Accused of Forcing Customers’ Hands on Prime Membership
The American consumer protection authority, the FTC, has filed a complaint against Amazon, accusing the online sales giant of pushing millions of customers to renew their subscription to its Prime service without their knowledge. The FTC also alleges that Amazon has complicated the termination process of the subscription, making it difficult for customers to unsubscribe.
The consumer protection agency claims that Amazon has used manipulative tactics to trick consumers into buying auto-renewing subscriptions, which not only frustrates them but also costs them money. FTC Chair Lina Khan stated, “These manipulative tactics harm both consumers and law-abiding businesses.”
Specifically, the FTC accuses Amazon of designing manipulative interfaces to encourage consumers to subscribe to the automatic renewal option. For example, it was more difficult to find the option to buy an item without subscribing. These practices were well known within the company, and some employees advocated for changes, but department officials resisted any such moves, according to the FTC.
The cancellation process, referred to as “The Iliad” within the company, was intentionally labyrinthine to prevent customers from unsubscribing, the agency argues in the complaint. The FTC demands that these practices be definitively prohibited and seeks unspecified financial compensation for affected customers.
Amazon’s stock fell 1.4% on Wall Street following the announcement of the complaint. The company has not yet responded to the request for comment from AFP.
This is not the first time Amazon has faced legal action. In May, the company agreed to pay over $30 million to the FTC to settle lawsuits related to privacy concerns regarding its Ring connected doorbells and voice assistant Alexa.
The consumer protection agency’s complaint against Amazon highlights the need for stricter regulations and enforcement to protect consumers from deceptive practices in the online marketplace.
How has Amazon made the subscription termination process complex and difficult for customers to navigate
Amazon Faces Allegations of Coercing Customers into Prime Membership
Amazon, the leading online sales giant, is now under scrutiny as the Federal Trade Commission (FTC), the American consumer protection authority, has filed a complaint against the company. The FTC accuses Amazon of pressuring millions of customers into renewing their subscriptions to its Prime service without their knowledge. Additionally, the agency claims that Amazon has intentionally made the subscription termination process complex and difficult for customers to navigate.
According to the FTC, Amazon has employed manipulative tactics to mislead consumers into purchasing auto-renewing subscriptions, resulting in frustration and financial losses for the customers. FTC Chair Lina Khan emphasizes that these tactics not only harm consumers but also affect law-abiding businesses.
The complaint specifically accuses Amazon of creating interfaces designed to encourage consumers to opt for automatic renewal. For instance, it was deliberately made more challenging to find the option to purchase an item without subscribing. The FTC claims that these practices were known within the company, and despite some employees advocating for changes, higher-ups resisted implementing them.
Regarding cancellation, the FTC argues in the complaint that Amazon deliberately created a convoluted process, referred to as “The Iliad” internally, to hinder customers from unsubscribing. The agency is demanding a definitive ban on these practices while also seeking unspecified financial compensation for affected customers.
Following the announcement of the complaint, Amazon’s stock experienced a decline of 1.4% on Wall Street. The company has yet to respond to AFP’s request for comment.
This is not the first time Amazon has faced legal action, as in May, the company agreed to pay over $30 million to settle lawsuits with the FTC related to privacy concerns surrounding its Ring connected doorbells and voice assistant Alexa.
The FTC’s complaint against Amazon highlights the necessity for stricter regulations and enforcement to protect consumers from deceptive practices in the online marketplace.
