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Angela Ng (left), chairwoman of the Trade Practices and Consumer Complaints Review Committee, and Consumer Council chief executive Gilly Wong at a press conference on the fitness chain’s sales practices. Photo: Bruce Yan

Hong Kong Consumer Council names and shames California Fitness for aggressive sales practices

Watchdog publicly identifies a fitness brand for first time, claiming chain persisted in its undesirable tactics

Fitness chain California Fitness was publicly named and criticised by the Consumer Council on Thursday for deploying intimidation and misleading sales practices to press consumers into purchasing memberships and high-priced private lessons.

This was a “necessary move” in response to rampant sales practices and “uncooperative attitude” by the fitness operator, said the council’s chief executive. It was the first time the council had publicly named a fitness centre brand.

Consumer Council chief executive Gilly Wong Fung-han said complaints against California Fitness “showed no signs of decline after we met with the management in January to express our dissatisfaction against their continued undesirable sales tactics”.

Instead, the sales practices became more aggressive, she said.

In 2015, the number of complaints lodged against the fitness chain increased by 30 per cent to 296 cases, comprising 51 per cent of all the complaints the council received.

A total amount of HK$8.5 million was involved in the cases against California Fitness, a 20 per cent increase compared to the previous year.

Among the complaints against the chain, 22 cases involved over HK$100,000 each. In one case, the involved amount was as much as $570,000.

California Fitness could not immediately be reached for comment.

Half of the complaints against the gym chain came from new members, who claimed they were pressured or misled into signing membership agreements.

One of the most common sales practices was to lure new customers from the street with lucky draws or free trials. Several staff would then take turns to hard sell memberships and courses for two to three hours, according to the council.

Some staff members also asked new members to enter their bank cards’ personal identification numbers for “identify verification purposes”, then completed transactions without their consent, some complainants alleged.

People exercising at the chain’s centre in Wan Chai. Photo: Felix Wong

John Chu, 26, a professional who became a member of the chain two months ago, said he was offended by the aggressive sales tactics deployed by the staff during his workout section.

He said some coaches constantly pointed out flaws in his body, such as his belly, while trying to talk him into signing up for expensive private training classes.

To avoid this, Chu said, he went to the gym after 10pm when most salespersons got off work.

Existing members were not immune to the dubious sales tactics.

In one case, a complainant with a seven-year membership was persuaded to purchase private classes worth as much as HK$550,000. But the centre required members to use those classes within a short period of time. When the complainant asked for a refund of HK$200,000, the centre refused, and agreed to pay only HK$120,000.

Rena Tinuk, a teacher in her 30s and member of the chain for four years, said she had grown accustomed to the tactics.

“They’re always like that,” she said, adding she had to regularly refuse the sales staff at the Wan Chai location she patronised.

Complaints against California Fitness were up 30 per cent in 2015 on the year before. Photo: Felix Wong

Although Tinuk understood that aggressive practices stemmed from the industry’s fierce competition, she said she at times felt annoyed.

The council reminded gym users to avoid signing too many contracts that would lead to losses if they could not complete classes within a limited time period.

It also called for legislation to introduce a cooling-off period as a way to safeguard consumer rights.

The council urged the government to take urgent action to study the legislation, as the intimidating and misleading sales practices deployed by the fitness and beautify industries had become more rampant in recent years.

Federation of Trade Unions lawmaker Bill Tang Ka-piu welcomed the council’s decision to openly criticise California Fitness, stating that many of the complaints he received in the past year were also related to the fitness centre.

The lawmaker said acooling-off period was urgently needed and would be beneficial to fitness centre staff as well as protect consumers.

“Once there’s a cooling-off period, it would be a waste of time [for sales staff to trick clients] ... because the client could cancel the contract the next day,” he said. “It would enhance services and also lessen the incentive for staff to break laws.”

Of all the complaints Consumer Council received in 2015, 51 per cent related to the chain. Photo: Felix Wong

In addition to the cooling-off period, Tang added that the government needed to provide extra support measures to protect vulnerable groups, such as those who were mentally disabled.

He explained that while individuals in those groups could cancel the contract under the Unconscionable Contract Ordinance, the current system made it difficult for them to do so, as there was a lack of administrative support.

According to Customs, the use of harassment, coercion or undue influence to impair a consumer’s freedom of choice or conduct contravenes the Trade Descriptions Ordinance, which carries a maximum penalty of five years’ imprisonment and a HK$500,000 fine.

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