What we know about the Amazon Prime settlement

(NewsNation) — Amazon has agreed to a $2.5 billion settlement with the Federal Trade Commission over claims it duped millions of customers into signing up for Prime memberships and then made canceling a hassle.

The e-commerce giant will pay a $1 billion civil penalty and return $1.5 billion to consumers who were harmed by the company's deceptive enrollment practices, the FTC said Thursday.

"The evidence showed that Amazon used sophisticated subscription traps designed to manipulate consumers into enrolling in Prime, and then made it exceedingly hard for consumers to end their subscription," FTC Chair Andrew Ferguson said in a statement.

The $1.5 billion for consumers is the second-highest restitution award ever obtained by FTC action, according to the agency.

Here's what we know about who qualifies for a refund and how much they could get.

Who is eligible for the Amazon Prime settlement?

The FTC estimates 35 million consumers were impacted by unwanted Prime sign-ups or unsuccessful cancellation attempts.

According to the settlement, U.S. consumers may be eligible if they:

• Signed up for a U.S. Prime subscription between June 23, 2019, and June 23, 2025, using the company's "Single Page Checkout" or other enrollment links.
• Tried and failed to cancel a U.S. Prime subscription over the same time period
• Accidentally took a "Save Offer" during the online cancellation process

If that sounds confusing, don't worry — Amazon is required to notify eligible customers and provide detailed instructions.

How much money could you get from the Amazon Prime settlement?

The exact payout will likely depend on how many people claim refunds, and not everyone who qualifies is entitled to the same amount.

Instead, there are different tiers based on how often customers used their Prime benefits.

• Automatic refunds (up to $51): Eligible customers who used no more than three Prime benefits in a given year after signing up will receive an automatic payout up to $51. Those consumers don't need to submit a claim and should receive a refund within 90 days of the court order.
• Claim-based refunds: Eligible consumers who used their Prime benefits more often will need to file a claim. Those people will have up to 180 days after receiving a form to submit it to Amazon by email, postal mail or through a settlement website.

Once the claims process is complete, if Amazon has paid out less than $1 billion, then it will have to make additional rounds of automatic payments to eligible consumers.

How will you know whether you qualify for a refund?

After automatic refunds are issued, Amazon will have 30 days to notify anyone still eligible to file a claim. Instructions will come by email and postal mail.

Amazon then has 30 days to review submitted claims and determine they're valid. Those who qualify may receive up to $51.

The company is also required to set up a settlement website with relevant information and instructions.