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Personal finance: Slim chance of cancelling once you've signed up to a costly 'free trial' offer: The adverts invite you to try a slimming aid for nothing more than the p&p. But as Anna Tims warns, you could end up paying a lot more than that

June 1, 2014

Anna Tims



The advert offers a wonder slimming supplement with "100% satisfaction guaranteed". For just pounds 4.95 postage and packaging, applicants receive a free bottle of the herbal remedy NutriBerry Slim for a 14-day "risk-free" trial. The website also suggests a free try-out of a natural detoxification product Vita Cleanse for a further pounds 6.95 p&p.

Anne Jones (not her real name) signed up for both. Two weeks later pounds 182 was removed from her account. And each subsequent month the same sum has disappeared. "I realised my mistake, emailed the cancellation email address within an hour of ordering and have continued to do so for the last 19 days, but I have had no reply and my bank tells me it can't stop the payments, only dispute and refund them each time," she says.

My postbag bulges with similar stories from scores more people beguiled by the promise of a "free trial". In fact, the terms and conditions of the offer, which are hard to find, commit those who sign up to an ongoing supply of the products at pounds 93 and pounds 89 a month, unless they cancel and return the bottles within 14 days of ordering.

Those who have tried to do so report that calls are ignored and emails bounced back. Others have received their trial package well outside the 14-day deadline, invalidating their chance to cancel. And a worrying number have been told by their banks that nothing can be done to prevent the payments pouring out.

"My credit card company says I cannot stop these payments unless NutriBerry Slim agrees," says another reader. "I put a stop on them two days after applying for the trial, but they were still paid two weeks later. I have cancelled my card but the bank tells me that won't help."

The ignorance of banking staff is almost as dismaying as the NutriBerry Slim rip-off. Customers applying for the free trial have, in fact, signed up to a continuous payment authority (CPA) which allows a company to take recurring payments off a credit or debit card.

However, customers can cancel a CPA whenever they want and, although it's best to do this through the company taking the payments, they have the legal right to do it through the card issuer without the company's agreement.

The banks' confusion is all too familiar to the Financial Ombudsman Service (FOS). "We often hear from consumers who say their bank has incorrectly told them that it cannot cancel the CPA and they have to get in touch with the business that set it up," a spokeswoman says.

"A bank must cancel a CPA if a consumer asks and, if they don't, the consumer may have the right to reclaim from the bank any amounts taken. This was something the Financial Conduct Authority reinforced back in June 2013."

For the many victims of the offer, tenacity is the key. The FOS says it would expect complainants to show that they had made reasonable efforts to cancel through the trader before ruling that a card issuer owes them a refund.

NutriBerry Slim customers are stalled by its insistence that they obtain a return merchandise authorisation (RMA) before they can cancel their order. This can only be done by telephone and many customers who have tried, say they have found their calls unanswered or staff uncooperative. This is enough to go to the card issuer and demand that future payments be stopped. If the bank pleads impotence, the FOS will step in. "We're able to resolve the majority of these cases quickly," says the spokeswoman. "Often just pointing out that a bank is obliged to cancel a CPA when the consumer contacts it is usually enough."

The question remains how outfits like NutriBerry Slim get away with bamboozling so many with apparent impunity. The company behind the product is Healthy Essentials Ltd, registered to a business park unit in Cardiff and gives a PO box in West Lothian for returns.

However, Healthy Essentials is listed as dormant on the companies register. Customer support is answered by an operative who claims that she and Healthy Essentials are based in Florida, but have "call centres all over the world".

No US address is given on the website and the Advertising Standards Authority (ASA), which says it has received complaints about the free trials, has been unable to track it down. "Because it is based abroad it unfortunately makes the enforcement of our rulings difficult and limits the range of sanctions that can be applied," an ASA spokesman says.

"We've therefore taken the recent decision not to investigate complaints about overseas-based operators but, instead, to raise consumer awareness. We'll shortly be publishing a news article on our website to highlight the general problem with ads like this and, in doing so, hopefully, help warn consumers."

UK advertising rules are clear. Ads should not be misleading and no one should be unwittingly tied into an ongoing payment commitment. Moreover, under the distance selling regulations customers are entitled to cancel an online order within seven working days from the day after they receive the goods.

Rose Kimly, who answers the Healthy Essentials phone line, insists customers are warned they are committing to monthly payments at the top of the second page of the registration form before card details are entered. In fact, this is at the bottom of the page, the tiny print almost invisible beneath a large banner reading "Act Now for a Risk Free Trial", and the crucial details of the contract are in the final lines after a lengthy blurb about the company's pride in its product.

Given that companies like this can avoid the powers of UK enforcers, consumers have to protect themselves. Never relinquish your payment details for a free trial without checking what you are committing to. If there are no visible terms and conditions then steer clear. Similarly, alarm bells should ring when a company gives a PO box address. And, while you're online, research the benefits of the product you plan to trial.

In the case of NutriBerry Slim and Vita Cleanse there is no scientific evidence to back up their health claims and the internet abounds with complaints from those who feel they've lost money because of the company's business practices.

Jones says the expensive "free trial" has had an impact: "It has actually resulted in weight loss, but that's because of the stress and worry. I haven't dared take any of the tablets."

THE ABC OF A CPA

Millions of consumers set up regular automatic payments for anything from magazine subscriptions to gym membership and travel insurance. Some will be direct debits and standing orders, but others will be "continuous payment authorities" (also called recurring payment authorities, recurring transactions or recurring payments).

CPAs, also beloved by payday lenders, appear similar to a direct debit but they lack the same protective guarantees and allow the trader more flexibility over how much they remove from your account. So how do you know you've signed up? The clue is in the demand for the long card number, rather than bank account details on the registration form. Since the fact that ensuing monthly payments will be debited is buried down in the terms and conditions, few realise what they are letting themselves in for.

Many organisations say CPAs can only be cancelled by the retailer or business - that is wrong. You can go direct to your bank/card company and ask them to cancel the payments.

Captions:

Consumers say they have been unable to cancel payments after signing up for the Nutriberry Slim herbal remedy.



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Source: Observer (UK)


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