Ten More Everyday Swindles!

Last Tuesday, we revealed ten ridiculous rip-offs to reject. Here are ten more fiddles to add to our list.

Judging by the comments on our TMF Article Feedback board, the first part of this series on everyday rip-offs (More Rip-Offs, Scams And Swindles!) could well be one of my most popular articles ever. So, my grateful thanks to everyone who read it and to those who suggested more swindles to expose!

Without further ado, let's crack on by unveiling ten more howlers to avoid (again, in alphabetical order):

1. Airport shops

Along with hospitals and theme parks (see below), visitors to airports are at the mercy of 'captive audience syndrome'. In other words, they've got you right where they want you, so keep a close eye on your wallet or purse at all times. Indeed, just about everything on sale in an airport is massively overpriced, even stuff that is supposedly 'duty free'. Airports operator BAA (now owned by Spanish firm Grupo Ferrovial) and its retail partners make billions every year from terminally bored, frustrated passengers who often have no choice but to cough up or go without. When I head for Heathrow (which I rarely do these days), I always shop before I go!

2.    Bogus price reductions

When I see an item advertised at a discounted 'sale' price, I only check today's price, not the previous price. That's because firms can hike prices only to drop them later, so long as these price changes meet the terms of the Sales of Goods Act. For example, a shirt initially costing £10 could be advertised for some time at £20 and then slashed to, say, £9, giving an £11 'discount' off a £20 ‘price'. So, treat alleged sale discounts with a pinch of salt!

3.    Budget airlines

How can a flight advertised at £1 end up costing you fifty times as much? Simply add on taxes for leaving and entering the UK, rip-off fees for paying by credit or debit card, plus a charge if you check in baggage for the hold, and so on and so forth. In my view, it's hard to beat budget-airline operators for underhand advertising and additional charges. How long before we have a fee for using the onboard toilet?

4.    Card surcharges

Borrowing money at, say, 6% a year and lending it out at around 16% APR isn't enough for credit-card issuers. Nope, their goal is to charge you for every step you take. You'll pay a fee for withdrawing cash on credit cards (always a BIG mistake), spending money overseas or on foreign websites, transferring balances to low rate or 0% deals, using credit-card cheques, etc. Watch out for these fees and dodge them where you can!

5.    Cash-counting machines

My local ASDA, Sainsbury's and Tesco supermarkets all have lobby-based Coinstar cash-counting machines. You simply pour in a load of loose change (perhaps the coins from your whisky-bottle bank) and these will be counted in seconds. Alas, you don't get the full cash value of your coins, as there is a 7.9% administration fee.

What's more, you often aren't allowed to claim the cash at all. Instead, you can make a charitable donation, or receive store vouchers. Although some people may view this charge as fair -- and handling cash is expensive -- I won't ever use a coin-counting machine. After all, I have two youngsters at home happy to sort coins for free!

6.    Cheque clearing

As I warned in my earlier article, banks earn hundreds of millions of pounds in interest from the 'float' created by interbank payments made via BACS. For instance, when I send a payment from my savings account to my current account, my savings account is immediately debited. However, the matching credit isn't cleared into my current account until three working days later. The cheque-clearing system operated by APACS runs on similar lines. Indeed, you lose at least two day's credit interest on every cheque you write. Predictably, the cheque-clearing system is overly complicated; you can learn more here.

7.    Debits before credits

Let's say that I have a £100 credit going into, and a £100 debit leaving, my bank account on the same day. If the debit leaves before the credit arrives, then it will push me overdrawn and force me to pay extortionate bank charges. On the other hand, if the credit is first and the debit second, then I'll stay in the black.

Can you guess which way around banks will arrange these transactions? You guessed it: in order to maximise banks' profits, debits always leave before credits, creating a short-term overdraft which can then be milked for rip-off fees and interest. Personally, I doubt the legality of this approach, and I'd love to see a court case arguing that it breaches the Unfair Terms in Consumer Contracts Regulations...

8.    Estate agents' fees

99.99% of estate agents charge percentage-based fees, typically between 1% and 3% of a property's value. Thus, selling a £400,000 property incurs twice the fee of selling a £200,000 property. Does it really take twice as much effort to sell a property costing twice as much? I seriously doubt it, which is why I admire the no-nonsense approach of West London-based estate agency OliverFinn.

Uniquely, instead of mucking about with value-based fees, OliverFinn simply charges a fixed fee of £2,500 plus VAT to sell any flat and £5,000 plus VAT to sell any house. As its founder, Christian Harper, remarked to me today, "I marketed a house in the Nineties which sold for £302,000 for a £6,000 fee. I see that the same house recently sold for £1.6 million, for a fee of £32,000. With the Internet making life massively easier for estate agents, why should sellers fork out massive fees to sell properties, regardless of their size?" I certainly agree, Christian!

9.    Foreign currency

Next time you wander past local banks and travel agents, take a look at the electronic boards in the window which display currency prices. There will be two prices quoted: one for selling currency to you and one for buying it from you. Regardless of the popularity and stability of a currency, the difference between buy and sell prices will be around a tenth (10%). Adding on transaction fees and commissions makes buying foreign currency an even bigger rip-off. What a con!

10.    Games, ringtones and wallpaper for mobile phones

I am one of the few remaining British adults without a mobile phone, largely because I find them so very annoying and intrusive. Still, at least this means that I don't get scammed by firms charging anything from £1.50 upwards for ringtones and screen wallpaper, or £4.50+ for mobile-based games. Even worse, many of these deals are subscription services, which can mean handing over £4.50 a week for a parade of worthless tat. In my view, only the criminally insane would spend £234 a year on mobile-phone accessories!

So, there you are: another ten retail rip-offs to avoid like the proverbial plague. I'm only up to the letter ‘G', so I'll return to this subject later to add a further ten terrible money-wasters to our list. Finally, thanks again for your suggestions -- this series could run and run. Thanks for listening!

More: Fed up with being ripped off? Then find a better credit card, current account, mortgage and savings account today!