A subscription trap is an offer — usually a free trial or a small shipping fee — whose real purpose is to start a recurring charge, using an enrolment that is easy and a cancellation that is not. The FTC calls the pattern a negative option. It settled with Amazon for $2.5 billion in September 2025 and alleged Chegg charged nearly 200,000 people after they had cancelled.
A free trial, or a free gift for a small shipping fee. You enter a card. Then you are a subscriber, and getting out is a different kind of task from getting in.
The FTC’s term is a negative option: an arrangement where your silence counts as agreement to be charged. That is not inherently improper — a magazine that renews unless you say otherwise is a negative option, and so is your phone contract. What makes it a scheme is the asymmetry: enrolment engineered to be effortless, cancellation engineered to be work.
This page sits uneasily beside the rest of the site, because the defendants are not criminals. Amazon paid $2.5 billion in September 2025. Chegg paid $7.5 million. Neither admitted wrongdoing, and both settlements concerned interface design rather than deception about what was being sold.
We include it because the mechanism is identical to the one used by outright fraudulent operators. In December 2025 the FTC sent $27.6 million to 1,215,337 people enrolled without their knowledge in continuity plans behind free-gift-plus-shipping offers. Same statute, same pattern, different respectability.
$1 for postage, seven days free, a first month at a discount. The offer is real. Its function is to get a card on file, which is the actual transaction.
The recurring term appears — below the button, in grey, after the price, or behind a link. Accepting is a large coloured control; declining is a small link somewhere else.
Where it could have stopped
This is the moment the FTC’s complaints turn on: whether express informed consent was actually obtained. The test you can run in three seconds is whether you could state, without scrolling back, what you will be charged and on what date. If you cannot, the disclosure has failed — and that is on the design, not on you.
No reminder is legally required in most places. The clock belongs to the merchant, and it is the one part of the arrangement that runs entirely without your attention.
Full price, on a card you provided for a trial, under a statement descriptor you will not recognise — often a payment processor or a parent company rather than the brand you signed up with.
Not on the page you signed up on. An account area, then a settings tab, then a chat agent, then a retention offer, then a confirmation you must confirm. In the FTC’s Chegg complaint, hidden and requiring multiple clicks to locate.
Which is not always the end. The FTC alleged nearly 200,000 Chegg customers were charged after requesting cancellation, over five years and through complaints.
A “paused” account that resumes. A downgrade you did not ask for. A charge under a different descriptor. Each is individually explicable and collectively a pattern.
A dispute and a merchant-level block at the card issuer. It is the remedy that does not require the merchant’s cooperation, which is why it is the one that works.
The individual sum is beneath the threshold of action. $14.99 is not worth an afternoon. Across 35 million people it is worth $2.5 billion, which is the entire economics of the category.
Friction is invisible when it is on your side of the transaction. Nobody notices that signing up took one click, because it worked. The asymmetry only becomes visible when you try to leave, and by then the charges have started.
Forgetting is the product. A free trial that everybody cancelled on day six would not exist. The business model requires a predictable proportion of people to be busy, and it is priced accordingly.
The statement descriptor breaks recognition. A charge that does not carry the brand name you associate with the service will not be identified during a two-minute scan of a statement.
Cancelling is a negotiation, not a command. Retention offers, “are you sure”, a discounted plan, a pause instead of a stop. Every step is a chance for the process to be abandoned.
And the law is unsettled. The US rule requiring cancellation to be as easy as sign-up lasted nine months. There is no general guarantee to rely on, only enforcement after the fact.
The regulatory history is the honest answer to where this comes from, because the technique is older than the internet and the only thing that has changed is its speed.
The FTC’s Negative Option Rule dates from 1973 and was written for book and record clubs that posted physical goods. It addresses prenotification plans — the merchant tells you what is coming and you may decline — which is not how any modern subscription works.
In October 2024 the FTC finalised an amended rule, Click-to-Cancel, requiring cancellation to be at least as easy as enrolment. On 8 July 2025 the Eighth Circuit vacated it, holding that the Commission had not carried out the preliminary regulatory analysis section 22 of the FTC Act required. The court did not reach the substance.
What survives is the Restore Online Shoppers’ Confidence Act — a statute, so unaffected — which is what the FTC used against both Amazon and Chegg after the vacatur. Enforcement is now one company at a time.
The scale is in the FTC’s own complaint counts: from at least 33 a day in late 2020 to more than 90 a day in 2025, and over 100,000 in five years.
On 25 September 2025 the FTC announced a $2.5 billion settlement with Amazon over allegations that it enrolled millions of people in Prime without consent and made cancelling deliberately difficult. It is the largest civil penalty ever obtained for an FTC rule violation, and the case matters because it establishes that a subscription trap does not require a fraudster — only an interface.
The FTC announced on 15 September 2025 that the education company Chegg would pay $7.5 million over allegations that it hid its cancellation route and then kept charging people who had used it. Since October 2020 nearly 200,000 consumers were charged after requesting cancellation — the failure mode that a cancel button cannot fix.
The FTC finalised a rule in October 2024 requiring cancellation to be as easy as sign-up. On 8 July 2025 the Eighth Circuit vacated it on procedural grounds, without ruling on the substance, leaving the 1973 prenotification rule and case-by-case enforcement in place. The FTC reopened the question in March 2026, noting complaints had risen from 33 a day in late 2020 to more than 90 a day.
Before you sign up. Find the cancellation instructions first — if they are not visible before the card field, that is the finding. Set a calendar reminder for two days before the trial ends, not the day it ends. Where your bank supports it, use a virtual or single-merchant card number.
To cancel. Do it in writing where you can, and screenshot the confirmation with the date visible. Account pages change, and a screenshot is the only evidence that survives. Do not accept a pause when you asked to stop.
If charges continue after cancelling.
Looking back through statements. Sort by amount rather than by date; recurring charges are identical to the cent, which makes them easy to spot and hard to see chronologically.
For a mainstream company, nowhere unusual — it is revenue, and the enforcement question is only how it was obtained.
For the fraudulent end of the same technique, the structure is deliberate. The merchant of record is frequently a shell entity distinct from the brand on the website, which is why the statement descriptor does not match; the FTC’s December 2025 refund action names four separate companies behind one set of continuity plans. Separate entities per offer keep chargeback ratios below the level at which a payment processor terminates an account — the metric that actually constrains this business.
That is the real limit on the fraudulent version. Not detection, not enforcement, but the card networks’ chargeback thresholds, which is why the operators spread across many small merchant accounts and why disputing a charge does more than complaining does.
The other half of this story
Our sibling site Clean on Paper explains who the merchant of record actually is — and why the name on your statement is so often a company that exists only to hold a payment processing account.
No agency publishes a line item for most of the schemes on this site, so these charts show the official categories that contain this scheme. Each series is labelled with the agency's own category name. See how the mapping works.
Both, and the line is a regulatory one rather than a moral one. The FTC's complaints turn on whether express informed consent was obtained and whether cancellation was simple — the same two questions whether the merchant is a household name or a shell company selling keto gummies. It used the same statute against Amazon that it used against unauthorised-billing operators.
Stop dealing with the merchant and go to your card issuer. Ask for a dispute on the charges after your cancellation date, and ask them to block future charges from that merchant. Keep the cancellation confirmation — screenshot it at the time, because account pages change.
Not reliably. Card networks update stored credentials automatically when a card is reissued, so a subscription can follow you onto a new number. A merchant block placed by the issuer is the thing that actually stops it.
Most are exactly what they claim. The distinction that matters is not whether a card is required but whether you can state, without scrolling back, what you will be charged and on what date. If you cannot, the disclosure has failed regardless of the merchant's intentions.
In the US there was, for nine months. The FTC's Click-to-Cancel rule was finalised in October 2024 and vacated by the Eighth Circuit on 8 July 2025 on procedural grounds. Enforcement continues under ROSCA, case by case. Rules in the UK, EU and Australia differ and are changing.
That is common and not by itself proof of fraud — many subscriptions bill under a payment processor's or a parent company's name. Search the descriptor before disputing. If nothing credible comes back, treat it as unauthorised and call your bank.
Report it
Reporting is what produces the enforcement data on this page. Find the right agency and phone number for your country on the report page. If money moved in the last few hours, call your bank first.