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Health Club's Sales Tactics Probed : Inquiry: Potential customers may have been misled. Investigators say some were falsely told they had won free memberships.

November 15, 1990|IRENE CHANG | TIMES STAFF WRITER

HACIENDA HEIGHTS — The Los Angeles County district attorney's office is investigating a local health club after receiving complaints that the business intentionally misled potential customers in order to boost its membership rolls, authorities said.

The complaints say Hacienda Health Club, with branches in Hacienda Heights and Fullerton, used unfair business practices, including misleading newspaper advertisements and false telephone solicitations to lure customers, said Michael Delaney, deputy district attorney and head of the consumer protection division. The district attorney's office may file criminal and civil charges against the club, Delaney said.

The customer complaints were filed over the past year with the Los Angeles County Department of Consumer Affairs and with the Cypress-based Better Business Bureau of the Southland, which turned the complaints over to the district attorney.

Officials of the Better Business Bureau say they received 18 complaints involving both Hacienda Health Club facilities; Delaney would only say that "more than 10" complaints are involved.

Club owner Paul Snow declined to comment on the investigation. Tarrie Sullivan, director of operations for the club, acknowledged in a telephone interview that some sales representatives for the company "used the wrong terminology and they shouldn't have. But nothing was malicious."

She added: "We're not going to be closed down or anything like that. We just have to be careful on how we word things or say things."

Last week, employees at the Hacienda Heights facility--on Hacienda Boulevard near the Pomona (60) Freeway--declined to answer questions about the business, and ordered a reporter and photographer off the property. People trickling in and out of the building said they were generally satisfied with the club.

But customer complaints filed with the county and the Better Business Bureau say the club used a number of misleading sales tactics, including telephoning people at home and telling them they had won free memberships through a radio station, KPWR (106 FM).

But when they went to the club to claim the prize, the complainants claim they were asked to pay a "promotional fee" or a "special tax" of between $80 and $300, said Belva Hilton, a trade practice consultant for the Better Business Bureau.

Marie Kordus, general sales manager for the radio station, said KPWR never had a promotion agreement with Hacienda Health Club.

Club director Sullivan blamed overzealous sales representatives who, she said, heard that a radio promotion was in the works and "jumped the gun by using the promotion prior to the signing of it . . . without authorization."

Sullivan maintained that she does not know what promises, if any, were made by sales representatives during the telephone calls.

According to copies of complaints filed with the bureau, sometimes health club employees told customers that Hacienda Health Club members would be allowed into other major clubs, such as Nautilus Aerobics Plus, Holiday Spa Health Club and Jack LaLanne's European Health Spas.

When customers were unable to use some of the clubs named, they asked Hacienda to cancel their memberships and refund the money, according to the complaints filed with the bureau. The company either refused or stalled indefinitely, according to the complaints.

"They mislead you when you go in," said El Monte resident Sara Esquer, 29, who said she paid the club $114 for a membership in July after being told she could use other clubs in the area.

When Esquer found that she could not use the other clubs she preferred, she demanded a refund. According to Esquer, the company refused, and she complained to the Better Business Bureau.

Hacienda officials have told the district attorney's office that club members are allowed to use other clubs in the International Physical Fitness Assn.

However, association manager Deedee Dekalita said the offer extends only to member clubs located more than 50 miles from Hacienda Heights. In addition, Holiday Spa is not a member of the association, Dekalita said. The association has only one Jack LaLanne facility--in Chula Vista--although it does have 16 Nautilus branches, she added.

Carole Kuhns, 53, a Hacienda Heights mortgage broker, said her daughter paid $353 for four memberships after receiving a telephone call from the club saying she had won a drawing for a free membership.

"The guy tried to convince me how wonderful this was, all the free stuff I'd get with it, and that I could also get three other memberships," said Darri Kuhns, 19. "He said he needed somebody to claim the prize today because our names were going to be in the newspaper."

But when she went down to the club to sign up, another sales representative said she would have to pay a special tax in order to receive the free membership, Darri Kuhns said. "I said, 'OK, how much is the tax?' At first he said $105. Then he looked at me and said, 'For you, we'll make it $89.' "

Kuhns has not filed a formal complaint. She said she plans to do so if she fails in attempts to get her money back.

The club also has run newspaper advertisements touting non-existent swimming pools, Delaney said. Other ads implied that the Hacienda Heights facility had a tanning salon, when in fact only the Fullerton club offered one, he said.

Sullivan denied that her company's ads were misleading, saying that they always print a disclaimer stating that "locations vary."

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