This cheat works for all versions of transport tycoon. When the artificial intellegence competitors build roads, they often do not build them direct, taking long detours:

Now, you have the ability to provide a short-cut for these road vehicles. Since they will try to take the shortest route between two points they will take your new route:

Because the road vehicles are running on your own road, you are free to destroy parts of your own road. If you do this correctly you can trap the competitions road vehicles on your own road:

It is unlikely that you can trap all of the competitors vehicles (usually 5) in one go. But you can always build a new short cut and repeat:

You can do this untill you have trapped all of the competitor's road vehicles. The brilliant thing about it is that as they go round and round, their running costs continue. This therefore means not only is the competitor missing out on the profit they would have made, but making a loss, and if they don't have any other services they will eventually be bankrupted! (Unless you show mercy!)