Episode 4 Rip Off Britain

We asked you to tell us who's left you feeling ripped-off.

I think this is very, very, very wrong.

The bank passed charges upon charges upon charges.

Legally, it was right. Morally? That's where the doubt comes.

And you contacted us in your thousands, by post, email,

even stopping us in the streets. And the message couldn't be clearer.

You don't always get a straight answer.

- I'm not happy at all. - It's always that small print that has the clause in.

-We're being ripped off big time.

-Whether it's a deliberate rip-off,

a simple mistake or a catch in the small print, we'll find out why you're out of pocket

-and what you can do about it.

-Keep asking the questions.

And we do get results.

Your stories. Your money. This is Rip-Off Britain.

Hello and welcome to Rip-Off Britain, where today,

as always, we will be challenging the companies that you say

have left you feeling short-changed.

We are here to ask them the tough questions that sometimes you can't.

But most of all, to make sure you are being treated the way you deserve.

Absolutely, because these are tough times and who knows, maybe they are about to get worse.

So you need to know that your cash is working hard for you,

avoiding any suspect schemes or rip-offs along the way.

When every penny counts, it really can be frustrating if you get

caught out by a charge that you really didn't expect, we've all been there.

And it doesn't have to be a huge amount. We know from your letters

and e-mails that when you feel ripped off,

sometimes it is not how much you have lost, it is the principle that matters.

And that is very much the case with some of the stories we will be investigating today.

Coming up: the locals livid that to get hold of their own money,

the closest cash machines make them pay.

In city centres you get free ones, but not around here.

The more deprived area it is, the more they hike it up.

The companies cashing in on a mis-selling scandal.

I said to John, there's something wrong here.

They shouldn't be panicking like this for this money.

And more of your stories from our Rip-Off Britain one stop consumer advice shop.

One issue that you contacted us about in droves last year was

the soaring cost of car insurance.

But it is young drivers who are being hit hardest.

When you hear exactly how much some of them

have been asked to shell out, it is no wonder a whole generation feels

they are being priced off the road.

Passing his driving test was a milestone for Peter Nolan

and his mother Julie.

For the 17-year-old, it meant he was on the road to independence.

When I passed my test, I was over the moon, I couldn't believe it, really.

I thought it was great that I could finally go out

and just drive wherever I wanted to go.

I was overjoyed, I was thrilled to bits.

I immediately texted all my friends, couldn't wait to get home

and give him a big kiss and congratulate him, it was just fantastic.

But their initial excitement faded as soon as they started

looking into the cost of insurance.

Some of them were £17,000, which at that point, you just think, "Oh, my God! What's going on?"

Yes, you heard right, that's £17,000.

Understandably, Julie looked elsewhere.

She got a quote from her insurance company to see how much

it would cost to simply add Peter to her own policy. But that wasn't cheap, either.

I was insured at a good price, of 500-odd pounds.

I rang up, asking to put my son on as another named driver.

And the quote was £3,895.

That would be a whopping increase of £3,375,

an amount that would put a huge strain on their finances.

It is not actually much less than my mortgage,

it would stand at about 350 a month.

And that is just so much, you know, on top of what you have

already got, outgoing month after month, is just astronomical.

So, Julie has not gone ahead with that quote.

Peter may have passed his test, but he is still not on the road.

Not without a lift from his mother, anyway.

The fact my mates can drive and I can't at the moment, it's, like,

you can go out with your mates, but it's not the same,

you just want to be behind the steering wheel and just drive yourself.

Of course, Peter is just one of countless young drivers

facing exactly the same problem.

They've had the lessons, however much you have to pay for them, and they just can't drive, can they?

And that's all they want to do, just drive.

Just down the road, Peter's friend Rhys

and his mother Joanne also struggled to find a quote they could afford.

When we started looking at quotes, I was really shocked at the prices.

The dearest one was, I think, £20,000.

And I think the cheapest one was £2,000 plus.

Luckily for them, Rhys's father is in the motor trade

and he got a more reasonable quote through his trader policy.

I think that worked out at £860,

which is still an awful lot of money,

you know, the car is not really worth that.

Another friend, Chase, also feels priced out of the insurance market.

How are you doing, then, Chase?

What are you going to do with your insurance?

I think I'm just going to have to go on my mum's insurance, to make it cheaper.

On my own, it's just stupid money. About 10 grand for myself.

Quotes like these are typical for teenage drivers.

Insurance companies say it is because statistics show

that young drivers have more accidents, as Simon Douglas from the AA explains.

When they do have an accident, they do tend to be more serious.

The average claim cost for a young driver is something like £5,000

or more, whereas for an older driver, it is probably under £2,000.

Even so, in recent years, what young drivers are being asked to pay

has been made worse by a problem that affects drivers of all ages.

And that is the surge in personal injury claims and payouts

that the industry blames for pushing up premiums for everyone.

Across the country, the number of personal injury claims has rocketed

at a time when the number of road accidents has gone down.

Many say that is because the so-called compensation culture

is encouraging people to make claims

whether they have been seriously injured or not.

And a whole industry has sprung up to encourage that.

Claims management companies and even some insurers can earn

huge referral fees by selling on the details of people

involved in accidents to no-win, no-fee lawyers,

who can typically make around £1,350 for themselves on a whiplash settlement.

The Government has promised to ban these referral fees,

possibly even this year. We will have to wait and see if that makes any difference

to what we pay for insurance. But until then,

is there any way drivers can bring their premiums down?

One thing you might consider is these new insurance products, "pay how you drive",

where they fit a device in the car that measures how you drive

as an individual, and they give you a premium

based on your own driving behaviours, not the average for your peer group.

If you are willing to be measured in this way, it can bring the cost of insurance down significantly.

In the meantime, the families of the younger drivers we met have been left wondering

if there was any point in getting them lessons at this age.

I just don't know where we are going to go with it, I just feel...

I am gutted for him, just gutted.

Might as well just let him wait to get a job and hopefully

when he is 24, 25, it might be slightly cheaper, then that's that.

Big companies don't always make things easy to understand

and it can be confusing trying to work out why you haven't ended up with what you expected.

So if you feel bogged down, we've put together a booklet of tips and advice.

You can find a link to the free guide on our website.

Or to receive a copy in the post,

send an A5 self-addressed envelope to the address we give at the end.

A convenience that most of us just take for granted these days

is cash machines, giving us access to our money, 24/7.

But if you need cash urgently from one of them,

then paying for the privilege is becoming increasingly hard to avoid.

Round the country, there are now more than 21,000 cash machines

that charge to withdraw our own money. Add together the amount made by all of those charges

and you are easily looking at at least £130 million a year.

In poorer areas around the UK, like Anfield

and Toxteth in Liverpool, free to use bank cash machines

have virtually disappeared, leaving locals no choice

but to use ones that charge.

Figures worked out by the Liverpool Echo show just how bad things are.

Nationally, 34% of cash machines charge.

But in Toxteth, it is a staggering 81%.

In nearby Anfield, it is not much better, 71%.

City centres, you get free ones, but not round here.

The more deprived area it is, the more they hike it up.

To have to walk a good 15 to 20 minutes to get to the nearest

cash machine, not to pay, is frustrating.

At times, I've had to pay.

We sent one of our Rip-Off Britain researchers to get some cash out

in Anfield, starting from the stadium itself.

The closest two machines both charged.

£1.70 for the first one and a minute down the road,

£1.75 for the second.

The third machine she reached also charged, but that was out of order.

And though there were ATMs in shops and bars along the route,

none of them were free either.

But wait, she's spotted one!

More than 20 minutes of high speed walking later,

she has reached a junction, with two free cash machines.

Finally, she's got her hands on her money without having to pay any extra to get it.

Local councillor Paula Keaveney knows all about the issue.

It is a tax on poverty.

If you look at areas of deprivation where people are on low incomes,

and they are having to pay to get their own money out,

all that is happening is that

the problems are being made worse that they face.

So we talked to the banks, talked to government ministers, to try

and get recognition that this is a problem that the banks need to solve.

And the charges look set to get worse.

Last August, the Royal Bank of Scotland and Lloyds TSB

announced that customers with their "basic" bank accounts will soon

no longer be able to use the cash points of all other banks for free,

because, they say, they make a loss by letting them do that.

They say almost all affected customers will still be able

to withdraw cash free within one mile of their home,

but the government-appointed watchdog Consumer Focus doesn't agree.

What we are concerned about is that basic bank account customers

will have to pay more money to access their money.

These are the consumers that after all, have basic bank accounts

because they have the least money. So why are the poorest consumers paying more to access their money?

It is compulsory for all fee-charging cash machines

to display an early warning to customers,

either an on-screen message or a sticker on the machine itself.

If you want to avoid paying fees, do keep in mind that a lot of banks,

including the Royal Bank of Scotland and Lloyds TSB, do allow customers

to take cash out over-the-counter at the Post Office for free.

Remember also that cash points outside banks or building societies usually don't charge.

While machines operated by companies such as Cardpoint, YourCash

and NoteMachine normally will have a fee.

And if you are stuck,

try and get cashback in those shops or bars that offer the service.

Or, use a debit card instead of cash.

We went to Link, the company that runs the cash machine network,

to find out why there should be any charge at all

for getting out your own cash.

What do you say to the people who simply say you are cashing in?

Whatever way you look at it, you are just cashing in on people

running out of money, or being in an inconvenient spot.

How do you address that?

We try hard to make sure

we do not have that situation. So, we have got

a very broad and large free to use ATM network in the UK.

We do think there is a case for allowing pay to use machines

where there is consumer demand and it is a matter of convenience.

What can people do if they feel they do not want to walk 45 minutes to a free machine,

or they are on the bread line and they have to go somewhere else to get a free machine on principle?

There should not be any deprived areas in the UK

which do not have a free to use ATM.

If there are, then we are working with consumer organisations

to identify those...

Can an individual write and say, I represent this community

and there is no free machine, what are you going to do about it?

The Link website is there, asking for that information

with our address on, and absolutely we would welcome that and look at it.

-Thank you very much indeed.

-My pleasure.

And after our interview, there was a very positive development.

Link told us that as a result of our investigation,

they will now be contacting local councillors, MPs and media

in the parts of Liverpool that we highlighted, so they can identify

suitable locations where they can put additional free to use ATMs.

We are here in Manchester,

where Rip-Off Britain have opened their very first pop-up shop.

It's been a weekend of consumer advice from our team of experts,

and BBC Learning have been helping people of all ages improve their maths skill.

One area of our shop that has been particularly busy

is the video booth we set up for people to record their gripes.

The biggest cause of complaints we have heard is car insurance.

To insure him on a 1.1 Vauxhall Corsa is going to cost in excess of £5,000.

We have been quoted £4,000.

It had gone up from £750 to just over £1,000.

I had to pay £2,000 just to insure it, what a rip-off!

Another common insurance bugbear is the automatic renewal of policies.

Les popped in after he realised that the automatic renewal quote

on his home insurance was £150 more expensive

than the same cover for new customers.

When I checked on the website, there was a huge difference in the price,

so I rang the company to ask them why, and there was nothing. The cover was exactly the same.

If you do go online, as you did, and shop around,

not just with your existing insurer, go onto a comparison site

and look and see what you could get in the rest of the market,

you will find you can probably save hundreds of pounds each year

on your car and home insurance. Just phone your existing insurer and say, "I've had a look around,

"I realise I could get the same policy for £100 cheaper,

"will you give me my same cover back for £100 cheaper?" And they will often just say yes.

You really do just have to be prepared to shop around every year, there is no reward for loyalty.

-Stay alert!

-Absolutely.

-Thank you for coming in.

-You're welcome.

Payment Protection Insurance or PPI has been one of the big consumer scandals of recent years.

It was supposed to cover repayments on credit cards and loans if you lost your job or were unable to pay,

but it turns out almost 6.5 million policies were mis-sold to people who could never make a claim.

As a result, there are no end of companies promising they can get you your PPI payments back,

but, as ever, some are better than others.

Come on, boys.

John and Carol Henry have had a really tough time over the last couple of years.

Carol was made redundant and John had to leave his job for health reasons.

With neither of them working, their finances were put under huge pressure.

We couldn't pay our bills or our mortgage.

We couldn't pay the loans that we had, we couldn't pay our credit cards. We were in a real mess.

While he had still been working, John had taken out three loans.

Each time, he bought payment protection insurance to go with them

to cover his repayments if he became unable to pay.

-How much was it on this one?

-On this loan alone, it's £2,420.

-Yeah.

The cost of that wasn't small change.

In total, I have paid over £5,000 in PPI insurance,

which, if I hadn't done, could have paid off one of my loans.

After paying out so much, you can see why in autumn 2010,

when they became aware of the PPI mis-selling scandal,

John and Carol started to wonder if they had been mis-sold their insurance as well

and if perhaps they'd be entitled to some of that money back.

It dawned on me that John hadn't been asked enough questions about him taking out the PPI.

I think at the time he did take it out with the loans,

he felt very pressured into signing the forms

because he needed this insurance,

but I really don't believe, when we've discussed it,

that he had actually been truly informed as to what it really meant.

John contacted his creditors who assured him that he had not been mis-sold his PPI,

but a few weeks later, he received a call right out of the blue

from a company called Claims Management Bureau who said the opposite.

They insisted that he was entitled to compensation

and made some bold claims about just how much.

They informed him that he was actually entitled to a minimum of £1,500 rebate

on the PPI insurance that he had paid. That was the minimum he could expect.

I informed them that I had already contacted my creditors

and they told me that I hadn't been mis-sold it

and he insisted.

He said, "Yes, you are entitled to this. It's in the government guidelines."

They were very persistent in their methods of saying that I was entitled to this money

and that I should proceed.

In our financial situation, I felt we had to go for it.

Persuaded they were due some cash after all, John signed up,

agreeing to pay Claims Management Bureau an initial up-front fee of £234,

so that they could process his claim.

They said they were a time-effective, honest and reliable service.

That was music to your ears and you felt you could go along with that, you could trust them.

The couple didn't have the money straight away and told the company

it would take seven days to transfer it to them.

Every day without fail, they rang. "Is the money in the account yet? Is the money in the account yet?"

I said to John, "There's something wrong. They shouldn't be panicking for this money."

But the couple paid up and signed all the forms, at which point things went rather quiet.

After two months had gone by and they'd heard nothing, John called the Claims Management Bureau

to find out what was going on.

He got somebody on the phone who said to him, "Don't worry, it's all being dealt with.

"It's all being processed."

We got Christmas over, then I said, "John, you still haven't heard anything from these people.

"There's something not right here."

So he rang them.

The phone rang out and rang out - no answer.

-The phone's dead.

-Yeah.

In February 2011 with still no word, John contacted Trading Standards.

On their advice, he wrote to the company and sent the letter by recorded delivery.

It was signed for, but he heard nothing back.

Two weeks later, he sent another letter which was returned.

It had been opened by the Post Office, sent back to us,

informing us that the company was no longer at that address.

I then decided to contact the Police Fraud Squad and gave them all the details of the company.

The police said that they couldn't really help without more complaints,

but we've done some investigations of our own.

We got in touch with the Ministry of Justice, who regulate claims companies of this type.

They told us that the Claims Management Bureau is not authorised by them,

which means the company was trading illegally.

What that means for the £234 that John and Carol have paid is unclear.

They have now contacted the Financial Ombudsman Service,

to determine once and for all whether they were mis-sold PPI.

The Ombudsman Service offers this check for free,

so it really should be the first port of call for anyone wondering

if they may be entitled to claim back any payments.

We tried to get hold of the Claims Management Bureau for an explanation.

As yet, we've had no response.

Now, Britain's railway network used to be the envy of the world,

but nowadays it seems to make headlines for all the wrong reasons.

Images of steam trains take us back to an age of opulence,

bustling platforms and a time when travel was a luxury.

Britain invented the railways, but the modern rail network

faces accusations that it's become more profiteering than pioneering.

1.4 billion train journeys were made in the UK over the last year.

But passengers are becoming increasingly worried about the cost,

especially after last month's price rises,

when fares increased by an average of 3% above inflation.

Quite a blow when UK rail travellers already pay 20% more for their journeys

than passengers in Europe. Do you take the train?

-I drive if I can.

-Yeah, I would prefer to drive.

Even with the price of petrol and diesel,

I still think it's cheaper than taking the train.

I will be standing for my half an hour journey home now, so I don't even get a seat.

One such commuter is Rosie Fluin, who lives in York with her husband and young daughter.

Three times a week, she makes the 20-minute train journey into Leeds.

I travel to Leeds for work. I commute from York to Leeds

because I work for Leeds City Council three days a week.

I prefer to take the train because it's more environmentally friendly, more convenient and quicker.

It's just more expensive.

It costs me £14.30 a day, which is £42.90 a week,

which is nearly the cost of a weekly season ticket.

Rosie earns £920 a month at the council,

so even before the latest hikes in rail fares,

they were taking 20% of her salary.

What it's going to mean for me is I may have to stop working,

or I may have to stop working in Leeds and try and get a job closer to home,

because I just can't absorb the costs any more.

I haven't had a pay rise for two or three years

and it's just getting to the point where I can't afford to go to work.

Rosie doesn't want to move from York as her daughter has started nursery.

# Train arrives... #

Plus, it's a good area for schools and her husband works locally.

But Rosie says jobs in York are few and far between

and for her, Leeds offers better prospects.

I go to work cos I want to contribute to the family,

I want to provide for my family

and I want to also provide a good example to my daughter.

I don't want to not work. I want her to see both her parents working and that it's a good thing to do.

So, is there any hope for people like Rosie who say

they simply can't afford to travel by train?

The Association of Train Operating Companies blames rising ticket prices

on the fact that the Government wants to reduce

the amount of taxpayers' money going into the railways,

meaning tough decisions on fares have to be made

to guarantee ongoing investment in more trains, faster services

and better stations.

We also asked the Transport Minister, Theresa Villiers,

to see if she could see an end to the rise in rail fares.

A question she appeared to find tricky to answer.

I have asked you in a number of ways whether your phrase about bringing down the cost of the railways

would actually result in fares falling,

and you've not really been able to say the answer is yes,

and that is really the thing that people want to hear.

We believe we could get to a point

where fares would go up just by inflation,

so they would stay steady in real terms.

Now, whether it will be possible to go further and reduce fares is not something I can say at the moment.

But I am determined that the cost of the railways will come down,

and that passengers will take a share in those savings, so we can deliver better value for money.

Baffled by your bills?

I thought, "This cannot be true. It's totally unacceptable." I was so angry!

Trying to wade through never-ending small print

that leaves you totally confused?

I might have been stupid for not reading it,

or I've read it and not took it in.

I could kick myself, I really could.

You can write to us:

Or send an e-mail:

The Rip-Off team is always looking for the stories that matter to you.

I think you'll agree it's obvious from the experiences we have heard

today that quite understandably, most of us

want to know exactly where our money is going.

So when that is not clear, always do your research

and never be afraid to ask questions.

It's what we do on this programme, because it can seem that everyone is after your money.

So you have to protect it and you can never do too much research

or price comparison when you are being asked to hand over your cash.

Not least because you just might discover another company who will give you a better deal.

That's always a good thing. That's it for today, but join us next time,

when we will be looking into more of your stories and seeing if we can sort them out.

-Until then, from all the team here, bye.

-Bye-bye.

-Bye-bye.