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AA and BSM Fined for Drip Pricing
The AA and BSM driving schools have been fined £4.2 million by the CMA for using illegal drip pricing.
“The owner of the AA and BSM driving schools must pay refunds to more than 80,000 learners after failing to disclose the total price for lessons upfront”
More than 80,000 learner drivers are in line for refunds totaling over £760,000, with the average payout around £9.
People booking lessons online were initially shown prices that did not include the booking fee, which only appeared at checkout.
The AA acknowledged the fee was made clear prior to purchase but admitted it should have been displayed at the start of the booking journey.
This marks the first financial penalty the CMA has imposed since receiving new enforcement powers.
Automatic Refunds and Industry Impact
Affected customers do not need to take any action to receive their refund.
The AA admitted to breaking the law and agreed to settle early, resulting in a 40% reduction in the penalty.
The ruling comes amid wider CMA investigations into eight businesses over online pricing practices.
Government research found that almost half of online businesses used hidden or dripped fees.
These fees cost consumers up to £3.5 billion annually.
CMA Chief Warns on Consumer Protection
CMA chief executive Sarah Cardell emphasized the importance of price transparency.
“CMA chief executive Sarah Cardell said: If a fee is mandatory, the law is clear”
She said dripped fees can tip the balance when people are watching every pound.
An AA spokesperson said the company was disappointed with the outcome but had fully cooperated.
Protecting consumer rights had been central to their business for more than 120 years.