Scam Busters: Amazon Prime's Fee

When Simon Baarbé purchased two DVDs on sale from Amazon.com (Stock Quote: AMZN) last year, he thought he had scored himself a great deal.

But when the 26-year-old's credit card statement arrived weeks later with an extra charge of $79 traced back to Amazon, Baarbé found himself at the center of a frustrating incentive program that’s angered hundreds of customers.

The Program in Question
Amazon Prime is a membership program that promises free two-day shipping on select items on the site, as well as cheaper overnight shipping, for an annual fee of $79.

The program is offered as a free trial for one month and customers can sign up after they check out their purchases. Amazon automatically renews your membership after the initial trial period. But members can cancel anytime, and the site says anyone who cancels before the trial period is up will not be charged at all.

Scam or Sneaky Charge?
Baarbé claims he never signed up for the service and thus did not authorize the $79 charge. Moreover, the charge showed up on his statement as being sent to “AMZ*Prime Club.” The combination of the unidentifiable name and the asterisk led him to believe he had been scammed. It wasn’t until he did a Google (Stock Quote: GOOG) search that Baarbé realized it was tied to Amazon.

While Amazon claims that all new members are notified of their enrollment in the “Prime” program by email, Baarbé says the credit card statement was the first time he was made aware of the program at all.

Baarbé is not alone. In the four years since Amazon launched the program, hundreds of angry customers have voiced their displeasure on consumer websites and message boards with complaints of being duped by the online bookstore chain. Many say they were charged without their knowledge and that they never clicked on any sign-up offer for the program. Others say it was never made clear to them that they had to opt out of the program after trying it for a month in order to avoid the fee.

Amazon’s Response
MainStreet contacted Amazon with our concerns and heard back from Stephanie Robinett, a public relations manager for the company. Robinett says the terms and conditions are clearly laid out on the site. “If a subscription will automatically upgrade at the end of the trial, we explicitly state this on the sign-up page and we let the customer know their credit card will be charged,” says Robinett. “We also state on the same page that customers have the option to choose ‘Do not upgrade’ at any time during the free trial.”

Amazon does have a grace period for customers who feel they were wrongly charged. Robinett says the company will refund the full membership fee, provided the customer has not made any eligible purchases.



What You Can Do
Amazon automatically renews your Prime membership using the last form of payment extended. Often, that’s the credit card you have on file. If that card is inactive, the fine print states that Amazon has the right to use any other payment method they have on record for you. To avoid an automatic billing, don’t save your credit card information on the site. And make sure you uncheck any boxes during the checkout process that don’t pertain to your order. (Sometimes the option to join “Prime” is automatically checked for you.)

If you want out of the program, or want to reverse the charges, call Amazon’s customer service number at 1 (866) 557-2820 or go online.

The Verdict
So is Amazon Prime really worth its price? It depends on what you purchase and how fast you want it. Note that the following items are not eligible for expedited shipping under the Prime program:

  • Gift cards
  • Oversize or heavy items (such as computer monitors or televisions)
  • Products sold through third-party areas of the site, such as the Amazon Marketplace

Also, keep in mind that Amazon offers free standard shipping on most orders over $25, and you can take advantage of that savings without having to sign up for any membership program.

The most important lesson: Read the fine print. Whether you know it or not, you may have inadvertently signed up for the program during the checkout process. Though some claim Amazon purposely makes the process difficult to understand, the terms and conditions are there. It’s up to you to read through them and make sure you’re only paying for what you actually want.

 

 

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