Don’t get caught out by “free trials.” Part 1

If you spot an interesting freebie that you need to give your payment details to get hold of, be careful you’re not signing up to a continuous payment authority.

We all love a free sample – who wouldn’t? They allow you to try something without having to commit to it long-term, and without having to spend lots of money either! Or that’s how it should work.

However, there have been a number of cases hitting the headlines recently that talk of people handing over their payment details and receiving a nasty surprise a few weeks later. They were asked to pay for the post and package on samples and, after receiving what they paid for, discovered that further payments had been taken from their accounts without their permission.

That’s exactly what happened to a woman named Susan, whose story featured in the press recently. She’d signed up to buy two samples of face cream that she’d seen advertised on Facebook. The price? Free, all Susan needed to do was pay £2.99 per sample, for the post and packing of the creams – or so she thought.

In fact, when Susan’s debit card statement appeared at the end of the month, she found that the company she’d given her details to had taken a further two payments from her account, without her knowledge or consent. But how were they able to do this?

Let’s have a look at what happened.

The Scam

Part 1 – luring you in 

The page that Susan was directed to looked legitimate and professional. There was nothing to make Susan feel suspicious about it. It also had nothing on it about any further payments being taken, which is not unsurprising as, had they mentioned it, Susan would almost certainly not have signed up. So that’s part one of the scam complete, on to part two.

Part 2 – continuous payments

Part two of this scam was to take Susan’s payment details without advising her that they were actually setting up a continuous payment authority. So rather than the company just taking the one-off payment for post and packing, they helped themselves to two further payments of £75.95 and £79.95, before Susan realised she’d been scammed.

Part 3 – the paperwork

Include no paperwork when the samples are sent. This is another common tactic for scam companies. It eliminates the need for them to create a fake invoice and also prevents the buyer knowing what they’ve signed up to. It also made it really hard for Susan to get in touch with the seller when she realised something was wrong as there were no address, telephone number or email address details.    

Job done! The scam is complete – Susan has been duped into giving her details with no paperwork to refer to and no idea that more payments would be taken.

What are continuous payment authorities?           

They are perfectly legal and acceptable for a number of different uses. They are usually used for things like magazine subscriptions or gym memberships and allow payments for any amount to be taken from your account at any time. They are different to direct debits in that the firms doesn’t have to give you advance notice of when and what amount is going to be taken.  That said, reputable companies will always tell you this so that you can make sure the money is available. However, you can see how this leaves continuous payment authorities open to abuse by unscrupulous businesses.  

That’s it for today. Come back tomorrow to find out what you can do about it when you’ve been scammed.