80,000 learner drivers will be issued refunds (Image: Getty)
The AA has been hammered by the Competition and Markets Authority (CMA) with more than just a slap on the wrist. More than a staggering 80,000 drivers who took lessons with AA Driving School and BSM Driving School can look forward to a refund for one pretty bad reason – drip pricing.
The action follows an investigation into AA Driving School and BSM Driving School, both owned by Automobile Association Developments Limited (the AA). The CMA found that more than 80,000 learners were not shown the total price upfront when booking lessons online – as required by law. Instead, a mandatory fee was included later in the process.
As a result of the CMA’s investigation, the AA must refund affected customers of AA Driving School and BSM Driving School over £760,000 and pay a fine of £4.2 million for breaking consumer law – bringing the total cost to almost £5 million. This is the first financial penalty the CMA has imposed for a breach of consumer law using its new enforcement powers.
READ MORE: HMRC issues update over ‘random’ security checks for customer payments
READ MORE: HMRC warning over refunds being paid into bank accounts
Anyone who learned out to drive in one of these vehicles could be set to cash in (Image: Getty)
The amount repaid to individual consumers will vary depending on how many lesson packages they purchased, with the average payout around £9. Affected customers do not need to take any action to secure their refund. The AA Driving School or BSM Driving School will write to each customer outlining that their money will be automatically refunded onto the card they used to pay for their lessons – if that is not possible, the customer will be sent a cheque.
The AA has engaged constructively with the CMA throughout the investigation and moved quickly to address the CMA’s concerns. Having admitted to breaking the law, and agreeing to settle the case early with the CMA, the company received a 40% reduction to its financial penalty.
Sarah Cardell, Chief Executive of the CMA, said: “If a fee is mandatory, the law is clear: it must be included in the price from the very start – not added at checkout – so consumers always know what they need to pay. At a time when people are watching every pound, dripped fees can tip the balance.
“And when it comes to something as important – and costly – as learning to drive, people deserve clarity. With our new powers, it will never pay to break the law or treat consumers unfairly. Where the rules are ignored, we’ll step in to put things right.”
A spokesperson for AA driving schools said: “Although the £3 booking fee was made clear to customers prior to their purchase, we acknowledge it should have also been displayed at the start of the online booking journey.
“Having listened to the regulator, we made immediate changes to our website to make the £3 booking fee more prominent. We are now refunding all relevant customers. Whilst we are disappointed with the outcome of the investigation, we have fully cooperated with the CMA throughout and would emphasise that protecting consumer rights has been central to our business for more than 120 years.”
Katrina Anderson, Principal Associate at national law firm, Mills & Reeve said: “The CMA’s decision is an early sign of how its strengthened powers are materially raising the stakes for businesses that fall short of consumer law. With pricing transparency and online reviews clearly identified as enforcement priorities for 2026, this case shows exactly how that scrutiny will play out in practice.
“The legislation is designed to protect consumers from misleading pricing and unlawful pressure selling, while tackling practices such as drip pricing, where unavoidable charges only appear later in the buying journey, and partitioned pricing, where separate elements are displayed instead of a clear total cost.
“At a time when trust and loyalty are central to commercial growth, businesses cannot afford to get this wrong. The consequences go well beyond fines and customer refunds; the reputational damage can be just as significant.”