AA and BSM ordered to refund learner drivers for hidden fees
AA and BSM ordered to refund learner drivers for hidden fees
The Competition and Markets Authority (CMA) has ruled that the Automobile Association Developments and BSM Driving School must issue refunds to over 80,000 learners who were charged unexpected fees during online bookings. The watchdog’s probe uncovered that mandatory booking charges were not displayed upfront, misleading customers about the final cost of their driving lessons.
As part of the settlement, AA driving schools face a £4.2m penalty for breaching consumer laws. A total of £760,000 will be distributed among affected customers, resulting in an average refund of approximately £9 per person. The CMA highlighted that fees should be transparent from the beginning, not revealed only at the checkout stage.
A representative for AA driving schools expressed disappointment with the investigation’s findings but noted their full cooperation. The statement read: “While the £3 booking fee was communicated before purchase, it was not clearly visible at the start of the online booking process. We have since redesigned our website to highlight this fee prominently and are now processing refunds for all impacted customers.”
What is drip-pricing?
The CMA identified the practice as “drip-pricing,” where mandatory fees are concealed until the final stage of a transaction. This tactic can deceive consumers into agreeing to a service at a lower initial price, only to face additional costs later. Sarah Cardell, CMA chief executive, stressed that such practices undermine trust, stating: “If a fee is mandatory, it must be included in the price from the very start – not added at checkout – so consumers always know what they need to pay.”
Cardell further warned that drip-pricing can significantly affect decisions, especially during periods of financial restraint: “At a time when people are watching every pound, dripped fees can tip the balance.” The watchdog’s investigation targeted eight businesses, including the two driving schools, for similar violations.
