FILE PHOTO: A downtown building is wrapped in Amazon Prime advertising ahead of Comic-Con International, in San Diego, California, U.S. July 22, 2025. REUTERS/Mike Blake/File Photo

By Jody Godoy

(Reuters) -Amazon.com will pay $2.5 billion in fines and reimbursements to Prime subscribers to settle the Federal Trade Commission's allegations that it deceived its customers to generate subscriptions, the FTC said on Thursday.

Around 35 million Prime customers will be eligible for payout from a $1.5 billion fund, the FTC said. Amazon will pay $1 billion in fines to the FTC. The company did not admit wrongdoing as part of the settlement.

Shares of Amazon were nearly unchanged after the news.

Customers who signed up for Prime between June 23, 2019 and June 23, 2025 via offers the FTC said were deceptive and did not use more than three Prime benefits, such as Prime Video, in the year after they signed up will automatically receive a $51 payout, according to court documents.

The settlement also allows customers to submit claims for payment if they tried to cancel Prime and failed during that time.

Amazon said in a statement that the deal allows it to move forward and focus on customers.

"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," the company said.

As part of the settlement, Amazon has agreed to create a "clear and conspicuous" button to allow customers to decline a Prime subscription, and to make it easier to cancel. Amazon has also agreed to more clearly disclose the terms of a subscription during the enrollment process and to pay for an independent, third-party supervisor to monitor compliance.

The FTC announced the settlement days into a trial in Seattle federal court, where the agency argued to a jury that Amazon sought to enroll members whether or not they wanted the service.

The FTC said its investigation showed Amazon executives and employees discussed enrollment and cancellation with comments like “subscription driving is a bit of a shady world” and leading consumers to unwanted subscriptions is “an unspoken cancer.”

Amazon founder Jeff Bezos once said he wanted to make Prime so compelling that consumers would feel they are "being irresponsible" if they are not members.Amazon introduced Prime in 2005 for $79 per year and has steadily increased subscription fees, most recently to $139 in 2022. The program helped drive $23.9 billion in subscription revenue in the first half of 2025, making it a key growth driver for the company.

Amazon drove those recruits, the FTC said, by offering free trials on its website using pitches such as: "Get FREE Same-Day Delivery." But the FTC said Amazon had failed to clearly disclose to customers that selecting that option would enroll them in Prime and eventually result in monthly subscription charges.

The FTC started probing Amazon's subscription practices during President Donald Trump's first term and the case was filed during Joe Biden's presidency.

The settlement is the second-largest restitution amount ever for an FTC action, agency officials said, and represents a major win for the FTC's tough-on-tech agenda, which began during the first Trump administration.

(Reporting by Jody Godoy in New York and Ryan Patrick Jones in Toronto; Additional reporting by David Shepardson and Mike Scarcella in Washington; Editing by Scott Malone, Chris Sanders and Lisa Shumaker)