United States: The US Federal Trade Commission (FTC) has filed a lawsuit against Amazon, accusing the e-commerce giant of engaging in a long-term scheme to enrol consumers into its paid subscription program, Amazon Prime, without their consent and creating obstacles for them to cancel their subscriptions.

The FTC, responsible for safeguarding consumer interests, filed the federal lawsuit in Seattle, where Amazon is headquartered. The lawsuit alleges that Amazon knowingly deceived millions of consumers by secretly initiating their enrollment in Amazon Prime through an internal project called “Iliad.”

This legal action marks the first time the FTC has taken Amazon to court since Lina Khan assumed the role of chair in 2021. Khan, an expert in antitrust issues, is known for her inclination towards stricter regulations for technology companies that have experienced significant growth with minimal oversight.

According to the complaint, the FTC claims that Amazon employed manipulative and deceptive user-interface designs, referred to as “dark patterns,” to trick consumers into signing up for automatically renewing Prime subscriptions. The complaint further states that Amazon made it more difficult for customers to make purchases on the platform without subscribing to Prime.

The FTC’s complaint asserts that Amazon’s leaders deliberately impeded or rejected changes that would have facilitated the cancellation of Prime subscriptions. These practises are alleged to be in violation of the FTC Act and the Restore Online Shoppers’ Confidence Act, according to the complaint.

Launched in 2005, Prime has more than 200 million members worldwide who pay $139 a year, or $14.99 a month, for faster shipping and other perks, such as free delivery, returns, and the streaming service Prime Video. In the first three months of this year, Amazon reported it made $9.6 billion from subscriptions, a 17% jump from the same period last year.

In a news release announcing the lawsuit, the FTC said that although its complaint is significantly redacted, it contains “a number of allegations” that back up its accusations against Amazon. It also accused the company of attempting to hinder the agency’s investigation into Prime, which began in 2021, in several instances.

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