California Wow: Land seized by anti-money laundering agency

While reporting losses transferred 1.69 billion baht (99% of all transactions) abroad & to buy Phangnga land for founder Eric Levine from 2000-2011. Cheating customers by shutting down branches while selling memberships.

FITNESS SCAMS, MONEY LAUNDERING & CONSUMER PROTECTION

California Wow land seized by anti-money laundering agency

19/01/2016 
King-oua Laohong 

The Anti-Money Laundering Office (AMLO) has seized 88 million baht in land owned by defunct fitness firm California Wow as part of its fraud investigation. 

Amlo secretary-general Seehanart Prayoonrat announced the decision Tuesday after atransaction committee considered a request by the Consumer Protection Police Division to freeze assets linked to the bankrupt fitness club for alleged money laundering and fraud. 

The frozen assets included five parcels of land covering 18 rai in Phangnga.

California Wow’s slogan was “look and feel like celebrities” and founder Eric Levine was a bodybuilder who himself promoted the company with his big muscles every time he got on stage.

CLOSING DOWN BRANCHES & CHEATING CUSTOMERS

Between 2000 and 2013 California Wow closed down many of its branches withoutrefunding membership fees, including those for lifetime memberships.

The company was accused of cheating its customers and failing to deliver services promised in its advertisements.

About 100 California Wow customers and Consumer Protection Foundation staff protest at Silom Complex in Bangkok  demanding the financially troubled fitness club repay membership fees after closing down itsbranches. High pressure sales and hundreds of disputes over service marked the brief history of the fitnessclub. SOMCHAI POOMLARD

DRAINING CASH OUT OF COMPANY

The company’s financial transactions also show they transferred 1.69 billion baht, or 99% of all transactional activities (or transactions), to individuals both in Thailand and abroad from 2000-2011 while reporting operating losses for the business.

Moving large amounts of money out of the country while the company reported lossesis said to be proof that its executives had intentions of cheating customers.

The company transferred the money to buy land in Phangnga owned by Fitness Estate Co for which California Wow founder Eric Levine was named one of the directors on the board of directors.

Later, the company’s board of directors were replaced and a new company namedLatitude 43 was named as a major shareholder.

After all these financial manipulations, Mr Levine actually became the beneficiary of this newly created company Latitude 43.

Newspaper editoriial cartoon showing Bangkok Bank chasing after California Wow to get back the money it loaned the company.

California Wow formed a partnership with Fashion TV. The partnership was celebrated with a fabulous voyage aboard the F Diamond cruise ship.

Public companies traded on stock exchanges such as California Wow are usually held to stricter standards offinancial transparency.

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