Chancellor to Stop Subscription Trap Scam

The Chancellor Phillip Hammond will announce on Wednesday 8th March his plan to stop the scam known as the Subscription Trap and end misleading consumer practices.

This is where you agree to buy a product or take free samples, only to find out later that you’ve been subscribed and money is being taken from your account or credit card regularly without you authorising it.

This is a very common scam and unfortunately you can’t get your money back as it has been legitimate, though morally wrong of course.

The Chancellor promises the new measures will represent a crack-down on misleading consumer practices, including those which end up costing people money they aren’t expecting.

  • End subscription traps. The Government says people can end up in ‘subscription traps’ after they sign up to a paid-for service without intending to – for example, when a paid subscription starts automatically after a free trial. To address this, it plans to develop options to put a stop to this and ensure customers are notified in good time before a payment is taken. The Citizens Advice Bureau estimates that 2 million consumers have problems each year cancelling subscriptions.
  • Shorten and simplify small print. The Government will consider options for making terms and conditions clearer to consumers, including making the key terms much more obvious, examining the use of tick boxes, introducing rankings on good practice and improving understanding of which terms cause most confusion. (some mobile phone contracts run to 40,000 words).
  • Create new powers to fine companies that mistreat customers. Consumer enforcement bodies such as the Competition and Markets Authority will receive powers to ask civil courts to fine companies – including those in unregulated markets – which breach consumer law.

“Whether you’ve signed up to a music or TV streaming service, shopping service, wine club or beauty club, the key is to look out for these subscription traps when joining and diarise when to cancel if you don’t want it.

The details in these proposals will hopefully become clear over the next few months as the Business Department work on this and the Business Secretary will introduce the changes in a consumer green paper.

This package, once it becomes law, should eradicate a lot of bad business practice and make life easier for consumers.

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