State Investigators Pop In On Businesses For 'Compliance' Checks

By VICTORIA LIM The Tampa Tribune

Published: Sep 30, 2007

State investigators are wrapping up a two-week stay in the Bay area after making surprise visits to health clubs, telemarketing companies and sellers of travel services. The operation turned out to be educational for both the companies and consumers.

The state Department of Agriculture and Consumer Services call these checkups "compliance audits." Investigators checked for licenses and checked activities limited by those licenses.

"We don't get around to a lot of businesses unless there's a complaint," investigator Kraig Allen said. "This is an opportunity that the department has taken to get into the community, out to these businesses … and make sure they're doing things they should be doing."

The sweep included a total of 206 companies from all three industries in Pinellas and Pasco counties. The first week of inspections targeted telemarketers. Inspectors looked for licenses and the scripts companies use to sell over the phone. If the scripts don't match the ones companies file with the state, that's considered a violation.

We followed investigators for a day as they popped in on companies. Investigations supervisor Tony McDowell said employees at a Largo business complex told him that workers from American No Debt "poured out of the office like ants."

By the time investigators arrived, one licensed telemarketer remained. Chris Reinhold, director of operations, said the company was "totally in compliance" with the law. McDowell said his team did not find any unlicensed activity, "but the company was not very cooperative in what information we were asking them to provide to us. So they're now going to be on our radar to make sure they're not using unlicensed sales staff."

Investigators reviewed contracts and licenses during its inspections of health studios and sellers of travel (typically, companies that sell travel packages).

Health studios must carry a bond to reimburse consumers in case a company goes out of business. The company may be exemptif it has been operating for at least five years and has a satisfactory record. It can also be exempt if it only accepts fees 30 days in advance.

We tagged along with Allen as he checked health studios (commonly known as health clubs and gyms). Most were compliant, including CORE Rehabilitation Center in Clearwater.

"Obviously, when the state walks in - or any licensing board of that nature - it's a little nerve-wracking. But if you're doing everything right, you don't have anything to worry about," CORE regional manager Scott Hopkins said.

Fitness Together, also in Clearwater, was not. Allen issued a fine of $1,000 to the company after he said records showed the company was taking fees upfront for more than 30 days of service. A company representative declined to comment.

"She is a franchise and claimed the corporate office, which is not in this state, advised her how to do things, and obviously, the information they provided to her was not correct," Allen said.

Fitness Together has 21 days to come into compliance.

After the two-week inspection, investigators found 40 violations that resulted in $255,000 in fines.

There's a lesson here for the consumer, too. You can easily protect yourself before spending money by calling the state to check on the status of licenses for health studios, sellers of travel and telemarketers. The number is 1-800-HELP-FLA (1-800-435-7352). Ask about the licenses of the company and employees (if necessary) and about the company's complaint record.

It's like doing your own compliance audit - no state government badge necessary.

If you have a consumer question, call the help line at 1-800-338-0808 between 11 a.m. and 1 p.m. weekdays.