Physical gym staff in Hong Kong investigated for forcing HK$38,000 membership on consumer
After allegedly pressuring customer to pay large up-front fee, four fitness centre staff run afoul of trade ordinance in industry first
Two directors, a manager and a saleswoman from a Physical fitness centre in Mong Kok have been arrested over allegations that a customer was forced to procure a 10-year membership worth HK$38,000, according to sources familiar with the investigation.
The two directors - Luk Ngai-keung, 58, and his wife Ho Yuk-wah, 59 - and the two employees, aged 35 and 40, were granted bail pending further investigation.
The arrests were the first of their kind in the fitness industry after the trade descriptions law was expanded in July 2013 to include services, according to Hui Wai-ming, superintendent of a Customs and Excise Department squad investigating unfair trade practices.
Explaining why the senior executives were arrested in this case, he said: "Under the Trade Descriptions Ordinance, management staff will also be liable if an offence is committed with their consent or connivance or is attributed to their neglect."
The department is investigating more than 30 complaints against fitness centres. One source said about half of the complaints were against the company involved in this case.
"Salespersons or employees were accused of using harassment, coercion or undue influence to sell services," the source said.
The arrests were made between July 29 and August 4 after a female client lodged a complaint with the department in March.
The woman, who joined the centre with a 10-year membership about a year ago, was approached and persuaded to buy another 10-year membership when she was working out at a Mong Kok branch of the fitness chain in March.
She was told that the saleswoman could help her look into discounts but needed her identity card and credit card. When she handed them over, the saleswoman allegedly used her credit card to collect the payment of HK$38,000 without her consent.
When the victim was told the transaction was processed, she wanted to cancel it.
"But she was told she could not cancel it because the transaction was made and this was the company's regulation," Hui said. The victim then complained to the department.
The superintendent said the saleswoman was suspected of using coercion and undue influence and leading the victim to procure the membership.
After a months-long investigation, customs officers arrested the saleswoman in Physical's Sha Tin branch on July 29 and picked up the manager, 40, in its North Point headquarters. The directors were arrested on August 4.
Hui reminded consumers to be aware of individual needs and affordability and to firmly refuse to sign documents if they do not intend to purchase the service.
