Attorney General Gansler Fines Westminster Health Club for Failing to Comply with Maryland Law

BALTIMORE, MD ( April 16, 2010) - Attorney General Douglas F. Gansler today announced that his Consumer Protection Division has ordered the now-defunct Harbor Nautilus, Inc., 1030 Baltimore Boulevard in Westminster, and its owner, Charles B. Riddle, to pay $60,000 in penalties and provide restitution to consumers for payments for health club services and “facility enhancement” fees.

Under the Maryland Health Club Services Law, health clubs are required to register annually with the Consumer Protection Division. They also need to provide security to protect advance payments collected from members or certify that they do not collect advance payments. The Division found that Harbor Nautilus, Inc. and Riddle failed to comply with Maryland’s Health Club Services Law from September 2007 until the business closed in November 2009.

“ Maryland’s health club law was enacted to protect consumers from losing money if their health club closed abruptly,” said Attorney General Gansler. “The Consumer Protection Division vigorously enforces the law to ensure health clubs and their owners are registered and bonded.”

The registration requirement allows the Consumer Protection Division to ensure that health club payments made by consumers are adequately protected if the business closes. Prior to 2007, Harbor Nautilus, Inc. claimed that it did not collect payment of more than three months in advance from members and therefore, did not need to post security with the Division. However, the Division found that Harbor Nautilus violated the bonding requirement at least 60 times when it accepted payments in excess of three months’ services and charged an annual enhancement fee.

Marylanders are urged to call the Consumer Protection Division at 410-576-6350 before joining a health club, weight loss center or self-defense school to see if it is properly registered and bonded. Consumers can also find consumer advice about memberships in health clubs, weight loss centers or self-defense schools at www.oag.state.md.us/consumer/tip69.htm.