Earlier this week, Amazon settled with the Federal Trade Commission (FTC) to avoid a trial over allegations that the online retailer tricked customers into signing up for Prime subscriptions and then made it hard to cancel. The settlement amounts $2.5 billion in fines the FTC announced on September 25, the second-highest amount ever levied against a company by the agency.
Of that historic number, $1.5 billion is meant to be set aside as restitution that will go directly to Prime subscribers, capped at $51 per person. The other $1 billion will be paid to the government as civil penalties.
In addition to the fines, Amazon also agreed to improve the way it discloses Prime signups and create a simple way to cancel your membership. An Amazon spokesperson told Tom's Guide that some of these features have already been implemented for years.
The company was also keen to note that there is "no admission of guilt." We were told that Amazon plans to comply with the law and that it found it better to settle the case than go through a lengthy trial.
How eligible customers can get a refund
According to an Axios report, the refund will arrive in two waves.
To qualify, you need to have signed up for Prime between June 23, 2019 and June 23, 2025. It takes a bit of digging to find out when you may have signed up for Prime.
I was able to find some information in my Amazon account by going to "Memberships and Subscriptions" where you can click on "Payment history" underneath the price of Prime.
Mine goes back to February 2019, but to see anything older than 2019 you have to go to your order history. You can search for "Prime" there and payments should pop up.
Wave 1 claims
The first wave of payments will automatically go to subscribers who signed up for Prime via a "challenged enrollment flow" and haven't used more than three Prime benefits, which are defined as benefits you wouldn't have gotten if you didn't sign up for Prime.
Challenged enrollment flows include signups that came from "any version of the Universal Prime Decision Page, the Shipping Option Select Page, Prime Video enrollment flow or the Single Page Checkout."
This first wave will get the full $51 payment and do not have to submit a claim. Amazon is supposed to distribute payments within 90 days.
Wave 2 claims
Wave two claimants will have to fill out a form, but not until the automatic payment period is over.
This wave is for those who signed up via a challenged enrollment flow or were unable to cancel their memberships during the 2019 to 2025 period. They also must not have used more than 10 Prime benefits during any 12-month period of the subscription.
Reportedly, an attempt to cancel is being defined as "entering, but failing to complete, the online cancellation process" or "taking a Save Offer during the online cancellation process."
Amazon is supposed to send the form to eligible customers within 30 days of the Wave 1 automatic payments period ending. You'll have 180 days after receiving the form to submit it to Amazon through e-mail, First Class postage pre-paid mail, or the settlement website.
Amazon has 30 days after receiving a claim to review it and decide if its meets refunding. Again, the refund payment is capped at $51 per person.
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