Europcar, one of world’s biggest car and van hire operators, may have overcharged UK motorists by at least £30 million for damage to rental vehicles.
The French firm has come under fire after complaints that costs for repairs to things like windscreens were being hiked by up to 300% to boost profits.
It has now admitted to the scale of the problem after Trading Standards began an investigation into the alleged fraudulent activity last month.
[ADVERT]A Europcar UK spokesman said: “Following the recent commencement of an investigation, last June 23, by UK Trading Standards into repair costs levied by Europcar UK, the company is undertaking a thorough investigation and Europcar UK is fully cooperating with the authorities.
“Given the ongoing investigation Europcar cannot provide any more substantive comment at this stage. However, on the basis of its own preliminary review, Europcar’s view is that the implications of the investigation will be somewhere in the region of £30 million.”
What happens next?
The Telegraph is reporting that Trading Standards has had to pass the Europcar case to the Serious Fraud Office, which is preparing to launch a criminal inquiry against the firm.
If found guilty of a criminal offence Europcar could be fined up to 10% of its turnover and could also face compensation claims from customers impacted by the inflated costs.
The Telegraph estimates that half a million people have been overcharged over the last decade, which would mean an average compensation payment of up to £60 for every motorist impacted.
A spokesperson for the SFO would not confirm or deny whether it was investigating Europcar, but only that it was aware of the allegations made against the firm.
What about other car hire firms?
Many are calling for a wider investigation to establish if other car hire firms might be up to the same tricks.
Alex Neill, managing director of home products and services at Which?, said: “If Europcar is found to have inflated costs for repairs, people will be outraged.
“There should be an immediate investigation to ensure others aren't doing this and customers who have been left out of pocket are compensated without delay."
How to complain about car hire firms
If you have a problem with a car hire company you should complain. If they don’t reply within a reasonable time you can take your complaint elsewhere.
The European Car Rental Conciliation Service can deal with complaints about Avis, Alamo, Budget, Europcar, Hertz, National, Firefly, Enterprise and Sixt.
For UK rentals, the British Vehicle Rental and Leasing Association (BVRLA), can help you with complaints about its members, which include a range of big and small firms from Hertz to Avis.