The trust and good nature of people as young as 18 were abused to induce them to sign expensive gym contracts, said the Customs and Excise Department as it revealed the latest unscrupulous sales practices of Hong Kong fitness centres.
The department said on Tuesday that last week it arrested seven sales staff and one director at three fitness centres in Mong Kok and Yau Ma Tei for allegedly breaching the Trade Descriptions Ordinance.
Suzette Ip Tung-ching, head of the department’s unfair trade practice investigation group, said six victims, in their late teens or early 20s, had been targeted in the cases, which involved gym contracts worth around HK$670,000 (US$85,408). One of the victims was charged as much as HK$172,000 for a 10-year deal.
Ip said the tactic generally adopted by gym centres was to get young employees to sound out potential customers by handing out business cards or promotional leaflets to passers-by on the street, or asking them to fill questionnaires, and then getting them back to their offices.
“Victims were usually just being kind-hearted and wanted to help others, being unaware of possible fraud,” Ip said.
At the gym centres, staff asked customers for their personal details such as financial status and requested their identification and bank cards, claiming they just wanted to keep a record or check whether they might be eligible for discounts.
Even though the customers made it clear that they did not want to buy any service, they would be asked to fill in and sign a form just for record-keeping. But the form turned out to be a service contract.
“Gym centre staff involved in unfair trade practices usually target young people, aged mostly 18 to 25. [They] target them because they trust people too easily, being less cautious and lacking life experience,” Ip said.
The arrests were part of the Customs’ “Tornado” operation, which began in late 2018. Since then, the cases handled have involved a total of HK$1.8 million worth of gym contracts, the most expensive of which cost HK$273,000.
To date, 19 people, aged 21 to 43, have been arrested for allegedly using aggressive commercial practices to sell gym services. Four were directors, while 15 were sales staff. Some were involved in multiple cases.
Under the ordinance, traders who apply false or misleading trade descriptions to services or products using aggressive commercial practices or bait advertising are liable to a maximum fine of HK$500,000 and up to five years in prison.
Ip said luring customers by asking them to fill in questionnaires was a practice quite frequently deployed by small-scale fitness centres in recent months.
She noted some employees pretended to be understanding and helpful, asking the victims to pay up front and assuring them they could help cancel the contracts and get them a refund if they later changed their mind.
In some cases, workers purporting to help victims get a refund asked them to come back the next day, and then inveigled them into signing another contract.
The latest arrest came after the Consumer Council reprimanded four fitness centres for using aggressive sales tactics, even forcing some to borrow from moneylenders to pay the fees.
The worst example saw one customer forking out almost HK$2 million over four months, while others were accompanied to ATMs or banks to withdraw cash.
The four centres in question were SML Studio, Fitness Express Company and A Plus Fitness, all in Mong Kok, and Legend Fight and Fitness in Causeway Bay.
But on Tuesday Ip did not reveal the names of the gym centres involved in Customs’ operation.
She called on young people to be alert to offers of trial sessions and requests to fill in questionnaires, urging them not to give their identification cards or bank cards to any salespeople before deciding to purchase services.