Three former Budget Rent a Car employees have contacted Go Public to allege the Vancouver-area operation systematically and intentionally rips off customers, by grossly overcharging for minor repairs that sometimes aren’t even done.
“They did it on purpose — charging the customer like way too much,” said a former lot attendant, who worked at Budget’s Vancouver airport location for a year, checking cars for damage. He agreed to speak to CBC News only if he was not identified.
"The system is run like that ... the small charges, they make them big charges. Especially the windshield. They can make more money from the windshield," he said.
"All of the inspectors have to look at the windshield first."
He said staff members were told to inspect vehicles from top to bottom, even after customers were gone, and report any damage to managers no matter how minuscule.
"I remember one time there was a senior couple. The other [employee] found out there was a tire cut. But from our standards, they should not charge them, honestly," he said.
"The other [employee] asked for the manager to come out and take a look. And then the manager charged them, just charged them."
Some repairs not done
“If there was a scratch on the car, we charged their credit card immediately … and that scratch would never even be fixed,” said another former employee.
She worked at the Budget counter at the Abbotsford airport, and also spoke on condition she would not be named.
“For the three months that I was there, I saw only one car go to the repair shop, and it was rear-ended.”
She said several renters would be charged for rock chip damage on the same vehicle, but no repairs would be done until later when the vehicle needed a new windshield.
"Once the windshield has three rock chips in it, it would get replaced, and then at that point that customer would get charged for a whole windshield," she said.
She also claimed she was trained to push people to buy Budget’s insurance coverage — using a memorized script — even when they were covered by their credit card or other insurance.
“We were there to sell insurance. We were there to convince customers that were renting cars that they had no insurance.”
She said many customers who bought insurance were later charged the $300 deductible.
“Every time there was a scratch, I would always get a manager, because I didn't want to be the person getting screamed at [by the customer] for the fact it wasn't their responsibility,” she said.
“The manager would decide how much to charge [the customer account].”
She also claimed three or four times a week people were billed for damage they didn't cause.
“If [earlier renters] didn't notice it and we didn't notice it, then we would just charge the next person," she said.
“I saw customers that cried. They really cried. They were shocked,” said the lot attendant.
He claims some people were made to pay for damage caused by Budget employees after vehicles were checked in.
“Sometimes it’s the employees that make the damage, but everyone doesn’t want to be responsible for that. The manager will make a decision ‘Hey, call the customer — he’s your damage.’”
"There were a lot of [customer] complaints when I was there,” said an ex-manager, who worked at Budget’s repair facility at the Vancouver airport several years ago. Go Public agreed not to name him, because he fears repercussions.
He estimated 25 customers a day were overcharged for repairs.
“Every car that came from Budget that needed repair all had inflated costs on them, frivolous charges on them. Every repair that went through the system — the customer got overbilled.”
Budget's repair facility is owned by Inland Transportation, a company owned by wealthy Vancouver businessman Syd Belzberg. He also owns Budget Rent a Car of B.C., which runs the car rental outlets in B.C.’s Lower Mainland.
“The way [Belzberg] got around it is he would write a cheque from Budget to Inland Transportation [for inflated repair costs], as if it was an outside firm, and he wasn’t making profit.”
In reality, he said, Budget and Inland Transportation are the same Belzberg operation.
"He was there every day," said the former manager. "Everything that was going on, he knew about."
The ex-manager said he purchased windshields in bulk, for less than $100 each. Inland would then bill Budget approximately $800 for each installation and that cost would be passed on to customers.
Go Public heard from several recent renters, whose accounts were billed in excess of $1,000 for a new windshield.
The former manager also claimed customers were billed for windshield replacements, when in reality only a chip was repaired, at nominal cost.
"Different customers would be billed … on a windshield before it got replaced," he said.
"We repair the chip. The customer gets billed for a new [windshield]. It doesn’t get replaced. Another customer takes the car, chips the windshield again. He gets billed for a new one again. And it could have happened on numerous occasions — especially in ski season."
Manager promises action
Belzberg didn’t return calls, but general manager for Budget Rent a Car of B.C. Greg Harrison told Go Public he is looking into all of the ex-employees' claims.
"I wasn’t aware of these allegations, but we take them very seriously and will look into each one of them," said Harrison. "It’s our commitment to offer a high level of service with everything we do, so we take it seriously. We’ll look into it."
He said sometimes windshield chips are repaired, but "to the best of my knowledge" those customers had not been charged for a new windshield.
"All our windshield repairs are determined, whether we repair or replace, by an independent company, Speedy Auto Glass, which comes on site and does all our glass work for us."
When asked how Budget can charge 10 times what it costs to do windshield repairs, Harrison said the repair facility is "accredited" by B.C.'s public insurance provider.
"We offer the rates that are based on ICBC standards for our shop which is an accredited ICBC shop and that’s how we continue to offer the high standards we set for ourselves in the rental industry," he said.
However, Go Public discovered the repair facility is not accredited by ICBC, a contradiction Harrison couldn’t explain.
"To the best of my knowledge, we’re an accredited shop. You’re giving me information I have no knowledge of prior to this moment," Harrison said. He later sent an email saying he was misinformed by another manager.
As a result of our stories on Budget, Harrison confirmed the corporate head office in the U.S. has put Belzberg's operation under investigation.
"We’ve been in contact with them and we’re providing them information as need be," said Harrison. "We are contacting customers, anyone who contacts us we are responding to them.
"If in a customer’s mind they feel we have done something wrong, we want to make it right."
On Monday afternoon, Harrison emailed CBC News to say that an internal investigation had turned up nothing to support the allegations.
"We have reviewed our systems and records and have found no evidence of this activity. Out of the utmost caution and concern, we are in the process of engaging an independent third party to review relevant files to investigate these claims, and to make appropriate recommendations if required."
In some U.S. states, courts have ruled it's illegal for rental car companies to charge more for repairs than what they cost.
Several years ago, Hertz was made to pay almost $7 million in fines, after New York's attorney general went after the company for overcharging customers $13 million for repairs.
There is no specific consumer legislation in B.C. prohibiting the practice, though. The car rental industry is largely unregulated in Canada.
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Complaints: Misrepresentations in advertising or sales of new and used cars, lemons, faulty repairs, leasing and towing disputes
Complaints: Billing and fee disputes, mortgage modifications and mortgage-related fraud, credit repair, debt relief services, predatory lending, illegal or abusive debt collection tactics
3. Home Improvement/Construction
Complaints: Shoddy work, failure to start or complete the job
4. Retail Sales
Complaints: False advertising and other deceptive practices, defective merchandise, problems with rebates, coupons, gift cards and gift certificates, failure to deliver
Complaints: Service problems or billing disputes with phone, cable, satellite, Internet, electric and gas service
Complaints: Misrepresentations, shoddy work, failure to have required licenses, failure to perform
7. (Tie) Internet Sales
Complaints: Misrepresentations or other deceptive practice, failure to deliver online purchases
7. (Tie) Landlord/Tenant
Complaints: Unhealthy or unsafe conditions, failure to make repairs or provide promised amenities, deposit and rent disputes, illegal eviction tactics
Complaints: Bogus sweepstakes and lotteries, work-at-home schemes, grant offers, fake check scams, the grandparent scam and other common frauds
9. Real Estate
Complaints: Timeshare sales and resales, retirement communities and assisted living facilities, real estate fraud
10. (Tie) Household Products
Complaints: Misrepresentations, failure to deliver, faulty repairs in connection with furniture or appliances
10. (Tie) Home Solicitations
Complaints: Misrepresentations or failure to deliver in door-to-door, telemarketing or mail solicitations, do-not-call violations
Online Dating Scams
<a href="http://www.huffingtonpost.com/2012/05/15/online-romance-scams-cost-50-million-in-2011_n_1518162.html" target="_hplink">Fraudsters feigned interest</a> in lonely online romance seekers to rob victims of about $50 million last year.
Debt Collector Scams
Phony debt collection agencies <a href="http://www.huffingtonpost.com/2012/04/11/ftc-busts-scam-debt-collector_n_1418582.html?ref=business&ir=Business" target="_hplink">have pressured victims</a> into giving up millions of dollars. The Federal Trade Commission recently closed down two California-based <a href="http://www.huffingtonpost.com/2012/02/21/ftc-indian-call-center-fraud-debt-collectors_n_1289751.html" target="_hplink">companies with call centers in India</a> after they defrauded Americans out of $5 million over the past two years.
Online Marketplace Scams
Craigslist and eBay are a playground for scammers. Consumers have sent payments to <a href="http://www.huffingtonpost.com/2012/04/23/craigslist-scams-tips-losing-money_n_1445763.html" target="_hplink">places like Nigeria </a>for items advertised online only to discover they have been scammed. Last year, Romanians pretending to be U.S. citizens put fake ads for pricey items on eBay and Craigslist, <a href="http://www.huffingtonpost.com/2012/04/23/craigslist-scams-tips-losing-money_n_1445763.html" target="_hplink">defrauding Americans out of more than $100 million. </a>
Prize Money Scams
<a href="http://www.huffingtonpost.ca/2012/04/28/lottery-scam-probe-nets-2_n_1460916.html" target="_hplink">Canadian police arrested a man </a>who tried to take a $70,000 processing fee from an elderly Californian woman who believed she was going to win a $7.5 million lottery prize in April. More recently,<a href="http://www.huffingtonpost.com/2012/05/17/jamaica-lottery-scam-fraud-suspects-arrested_n_1525498.html" target="_hplink"> eight Jamaican swindlers accused</a> of duping Americans in lottery scams were also arrested.
Fake charity organizations come out of the woodwork to exploit the generosity of others, <a href="http://www.huffingtonpost.com/2012/03/09/tornado-relief-fraud-scam_n_1334853.html" target="_hplink">especially during times of disaster.</a> Most recently, an organization that claims to help disabled veterans called Disabled Veterans National Foundation (DVNF) <a href="http://www.huffingtonpost.com/2012/05/08/charity-fraud-disabled-national-veterans-foundation_n_1499314.html" target="_hplink">took millions of dollars from donors</a> without spending the money on veterans.
Mortgage Foreclosure Scams
Scammers targeting struggling homeowners have offered false services to help with mortgage settlements. Mortgage foreclosure scams have shot up <a href="http://www.huffingtonpost.com/2012/04/16/mortgage-foreclosure-scams_n_1429805.html" target="_hplink">60 percent in 2012 as new federal programs</a> for mortgages have provided avenues for fraudsters to exploit.
Travelling Relative Scams
Scam complaints related to travelling surged right before <a href="http://www.huffingtonpost.com/2012/04/11/spring-break-travel-scams_n_1418954.html" target="_hplink">spring break last year. Crooks defrauded</a> grandparents out of money when their grandchildren were travelling abroad. The scammers, who find out about the travel plans from places like social media sites, pretend to be the grandchild asking for wire transfers on the phone. The scams have involved scammers pretending in an email to be a victim's travelling relative who has recently been mugged or has lost their passport.
Although there isn't much data on how often it occurs, food scams can pose a tremendous<a href="http://www.huffingtonpost.com/2012/04/20/food-fraud-hoax-grocery-store_n_1439995.html#s889480&title=Milk_" target="_hplink"> health risk. The chances</a> of dilution and counterfeiting increase when food is imported from other countries, and some foods like fish and olive oil are particularly prone to adulteration.
Online Prescription Drug Scams
Scammers have sold drugs to online consumers and then posed as government agents asking the buyers to pay money to <a href="http://www.huffingtonpost.com/2012/04/12/online-prescription-drug-scam_n_1420776.html" target="_hplink">avoid jail time. A Texas woman </a>killed herself after being caught up in one of these drug schemes.
Credit Card Scams
Credit card breaches allow fraudsters to make charges on other peoples' cards after getting a hold of numbers. Global Payments Inc., a third party payment processing service for MasterCard and Visa, made headlines in April for reporting that over a million card numbers had been compromised from their system, <a href="http://news.cnet.com/8301-1009_3-57407981-83/global-payments-calls-data-breach-contained/" target="_hplink">according to CNET.</a>