New York Attorney General Andrew Cuomo announced last week that LA Weight Loss Centers Inc. reached a settlement to pay $275,000 in refunds to thousands of New York state customers who paid for but never received services after LA Weight Loss closed its doors in January 2008.

Read more here: LA Weight Loss to Pay Refunds to New York Members

Also Read:  LA WEIGHT LOSS, PURE WEIGHT LOSS

(Franchise Complaints)  Related posts:  THE INCHES-A-WEIGH “LICENSE”: THE PERFECT BUSINESS OPPORTUNITY?

Inches-A-Weigh Franchise Failure Prompts Fraud Probe, Lawsuits

Lite for Life Offers Help to Members of Closed Inches-A-Weigh

A FranchisePick.com reader writes the following warning about the Inches A Weigh franchise opportunity:

As a former Inches a weigh owner, I would strongly urge anybody thinking of purchasing one to stop dead in your tracks, turn around and run the other way. The organization will make you all kinds of promises they are incapable of fulfilling. They are overworked, underqualified, and their methods are extremely outdated. Ask any corporate representative how many centers have closed in the past year. The way they respond to that question should be enough to convince you I speak the truth.

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Warning to any current or future LA Weight Loss customers considering prepaying for products or services: rumors abound that certain LA Weight Loss Centers may be closing in the near future. If that happens, you may have a hard time getting a refund or the products you are owed.

According to the LA Weight Loss complaint site, numerous centers are believed to be closing in the near future:

LA WEIGHT LOSS CLOSING LIST

Says KH Poser:

I was an Area Manager for LAWL for the last 2 years. The handwriting is on the wall. …The laweightloss.com website reports that the company has 450 centers open, but it is a lot less than that. They have been closing 20-30 units now for the last several months. Many of the franchise centers were taken back over by corporate in an effort to re-invigorate the brand, but they could not make it work. Many of the centers are doing as little as $2000 a week in sales. When sales are that low, it makes it impossible to advertise…

(FranchisePick.Com) IS LA WEIGHT LOSS IN TROUBLE?

Late last year, rumors started appearing on FranchisePick.com a month or two before Pure Weight Loss (formerly LA Weight Loss) suddenly announced it was closing all 400 weight loss facilities nationwide. In fact, one reader posted about the California closings before it hit the news. Shocked Pure Weight Loss employees found themselves suddenly out of work. Thousands of members tried in vain to recover the hundreds, sometimes thousands, of dollars in prepaid services and products they had entrusted to the company. We’ve learned to listen to the rumors. Not always believe, but at least listen.

LA weight Loss and Pure weight Loss started off as the same company and continued to use the same same system. However, the franchise company currently operating as LA Weight Loss had disassociated itself from the company that became Pure Weight Loss well before it imploded. However, LA Weight Loss has had its own share of problems, and rumors that sound eerily similar to those preceding the fall of Pure Weight Loss seem to be escalating. What do you think?

June 11, 2008, DD wrote:

Watch for the ‘Closing’ signs of all LA Weight loss centers. First they start cutting back store hours, let go of some employee’s, then they begin to have a difficult time getting all their product. The biggest clue is that the local advertising slows way down. In my area I saw advertisements daily on many T.V. stations and heard them constantly on the radio. They rarely advertise now and they are quoting no prices. I believe, after being a former employee, that they are now near the end. They are doing all they can to get ANY business at this point in order to hang on until the end. This has been the pattern in other parts of the county. GET OUT NOW!!!!

June 10, 2008, Kim wrote:

I paid A LOT for my LA WEIGHT LOSS MEMBERSHIP and had a few months left. I had some stressors and stopped going for a few months, then decided to get jump started now that summer is here. Went to the store, and was shocked to see there was no sign, the store was empty, no sign on the door, and then I called and the phone rang and there was not even a message! And to think that last week I received a card in the mail to “Come back to LA for free”! I know the stores in Illinois closed, and I am over the border in Wisconsin. Right before I left, the store hours changed twice, and corporate was in there. I had a bad feeling about it and that also made me stop going. I am mad,feel like I got taken for a ride, and wonder how many may have just joined and got ripped off! These people need to be sued!

Apr 3, 2008, Laura House wrote:

Buzz is that the franchise centers are in just as much trouble as PURE/Corporate LAWL was. One of the largest franchisees, Barry Goodman, out of Brentwood, TN has shut down all of his south Florida centers with more on the way. At one time, Goodman owned over 100 LA Weight Loss Franchise Centers and was one of LAWL Franchise Companies biggest franchisees.

Also reported on other sites is that centers in Austin, TX, Corpus Christy, TX, and Victoria,TX are closing in additon to centers across the Tennessee area.

As a consumer or a potential franchisee– I would stay clear of this company. Looks like they are on their last legs.

ARE YOU AN LA WEIGHT LOSS FRANCHISE OWNER, EMPLOYEE OR CUSTOMER? WHAT HAVE YOU HEARD? SHARE A COMMENT BELOW.

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(FranchisePick.Com)  For anyone who lost money, time and patience dealing with Pure Weight Loss (formerly LA Weight Loss, here’s one for the “I thought I had it bad” file.  Pure Weight Loss employee “Angie” left this sad tale as a comment on a recent post:

I was an employee of Pure Weight Loss. This is my story…I was hired in October for a position in the Central Illinois market. I was from St. Louis. My family (husband and daughter) traveled the 150+ miles for the interview and was promised a career that would be very lucrative while helping people achieve their weight loss goals.

The Regional Director interviewed me and suggested I accept a position as Center Manager at a location some 60 miles further from where I interviewed. My family and I agreed and quickly went searching for a rental home on craigslist. Long story short, with no assistance from Pure Weight Loss, we spent about $2,000 on the move. I was in the position for 6 weeks, all the while discussing with my managers that I am concerned that the income I was receiving was not what was promised. They assured me, come January everything would be gravy.

We got the news that our center was closing on December 15. That morning I had signed up a woman who had been with us previously but didn’t come in to center, didn’t follow plan and didn’t meet with any success. The previous day my Regional Manager had called her and convinced her that there was no better time than now (2 weeks before the holidays) than for her to re-commit herself. We completed her paperwork when I called my area manager to share the success. In her first sentence she said, “Did you get her to take her product home?” I responded, “No, she’ll be back in 2 days.” She said, “Oh honey, we have to talk.” That’s when she informed me that we would be closing nationwide as of January 4, 2008.

We had to liquidate any product we could and call all 160 active clients and any inactive clients to inform them. A task left to me, a new manager and a 22 year old part time employee. Devastating. This is still devastating me and my family. It has financially broke us. We muddled through the remainder of our 6 month lease and had to move back to St. Louis for lack of work. I’m looking for a class action lawsuit. The clients and employees, including myself, are owed.

Did I mention my last paycheck bounced? The account was already closed…. Did you all get your notification that they filed bankruptcy? Jerks!

Other recent posts:

> PURE WEIGHT LOSS INFORMATION CENTER

Pure Weight Loss / LA Weight Loss Rumors, Complaints

L.A. Weight Loss Center Closings, Cutbacks & Rumors

Did HONESTY Kill Pure Weight Loss? or LA Weight Loss: The Movie

WHAT DO YOU THINK?  SHARE A COMMENT BELOW.

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Franchisees, customers & experts vote for their favorite new franchises at Top New Franchise: Who’s hot. Who’s not.

(FranchisePick.Com)  The bankrupt Pure Weight Loss (formerly LA Weight Loss) chain and owner, Vahan Karian, who left thousands of former members and employees without hundreds of thousands of dollars in services, products, refunds and paychecks is due in court March 14.  FranchisePick.com contributor Sue wrote:

I just received a notice from Bankruptcy Court regarding the case of PWL [Pure Weight Loss]. There will be a “Meeting of Creditors” at 10 am, March 14th at the William J. Green Federal Building in Philadelphia (600 Arch St., 2nd floor conference room, 10:00 am).
I don’t know if I can make it (don’t have to attend if I file my complaint by mail) but I think it would be great to go if I could get a bunch of their “creditors” (that’s US) to be there to face this shmoe down!
Anyone want to come to Philly??

If you are owed money by Pure Weight Loss, you should file a claim form through the bankruptcy court.  Click here for Pure Weight Loss Bankruptcy information and forms.

Road Trip Idea:  Why not come to Philadelphia for the Pure Weight Loss Creditor’s Meeting on the 14th and stay over ’til St. Patrick’s Day on the 17th?  We can throw a Pure Blarney Party & I’ll teach you all the acclaimed Sean Kelly Corned Beef & Guinness Diet.  We’ll invite Vahan Karian (A fine Irish lad) along and get him to run out on the tab.  I hear Vahan sings a version of Danny Boy so sweet it could bring tears to yer glass eye.

(FranchisePick.Com) Hundreds, perhaps thousands, of comments have been posted on FranchisePick.Com by victimized Pure Weight Loss (until recently LA Weight Loss) members, some of whom lost several thousand dollars when the 400 unit chain closed abruptly last month with seemingly little regard for its members or employees. While most media attention focuses on the former group, an article posted today in The Times of Northwest Indiana also describes the plight of the Pure Weight Loss employees who were as surprised as their members at their employer’s abrupt closing.

The Times interviewed Ruth Moton, the former assistant regional manager for 11 Chicago-area stores. In September, Moton sold her house and moved to Chicago from Pennsylvania at the company’s request. She signed a lease and incurred thousands of dollars in reimbursable moving and related expenses.

Then, a few weeks before Christmas, Moton and other employees were told the chain would close January 2, 2008, and they would start the new year unemployed. Pure Weight Loss has since filed for bankruptcy protection. The company and its founder Vahan Karian are being sued by the PA Attorney General for fraud.

According to Moton, the company owes many employees. Some final paychecks bounced, and while some employees have been able to roll their 401(k)s into IRAs, “trying to get her 401(k) savings has become a ‘full-time job,’ she said.”

Moton said consumers continue to suffer. Chicago-area stores alone had almost 1,000 active customers who came in every week. Customers who were excited to sign up during promotions in the final months could be out large sums.

“A lot of my centers had open houses in October and November, a time when prices were reduced and a lot of the clients took advantage of that and bought more products that apparently (the company) didn’t even have to get to them,” Moton said.

Last month, Pennsylvania Attorney General Tom Corbett filed a consumer protection lawsuit against Pure Weight Loss and its owner Vahan Karian, also known as Vahan Karabajakian. The lawsuit alleges deceptive marketing and sales of long-term contracts for weight loss supplements, prepackaged food and weight loss counseling services.

In a statement, Corbett said the company owes more than a half-million dollars to Pennsylvania customers alone.

(FranchisePick.Com) Background: December, 2007, Pure Weight Loss (formerly LA Weight Loss) announced it was closing all its 400 centers nationwide by Jan. 4., 2008. With no notice and little explanation, Pure Weight Loss left thousands of customers without a weight loss program, without the half-million dollars they’d collectively prepaid for Pure Weight Loss services and products, and with NO information regarding the whereabouts of their confidential financial and health records, which include both credit card data, personal disclosures and blood test results.

In Part One, we asked: Is Pure Weight Loss violating the HIPAA* Federal privacy law?

FranchisePick.com commenters have shared some disturbing information about the alleged mishandling of and indifference to Pure Weight Loss members’ confidential records:

Ramone [former manager]: At my center they were just left behind .(I worked for LA Franchise, but was shut down the same time as Pure) Only current or 2007 files were boxed and sent in . I as a former manager was very concerned about this but all my regional wanted boxed and sent was current. I left 2 file cabinets full of client charts with very private info in them behind to probably be tossed into the trash by either the building manager or the next tennant. No one at the home office of the franchise I worked for seemed to care. As the manager I was very upset by this, but where could I store them , so they all sit there as I am sure is the case at most of the Pure Centers.

Curious [customer]: Were you prohibitted from shredding them or mailing them to your clients?

Ramone [former manager]: It was as if they didn’t even exist. I was given no agenda for them. When I ask what would happen to all of them, I was told someone eventualy would come and pack up everything.I think we all know this is just not going to happen.

Barb [customer]: What DOES happen to our confidential info? They have our names, ss#, address, and the Care Credit account #. This is not good.

Lynn [former manager]: Our center, here in the Chicago Market, happened to get them all boxed and dumped off at the UPS station. We boxed ALL of ours up. Let me assure you, too, it was done at our own goodwill.

There was no organization. I had no idea what was going on until the last day. We were supposed to have been sent boxes and such.. but I only received labels. I went and purchased boxes. There was a small group made up of former employee, myself and our children bundled them all and shipped them to Corporate.

Our biggest concern was that they would be left in our center for the “clean up” crews to go through. The clean up crews sent in my the leasing company.. not Pure.

rose [customer]: ...I am worried about the records - that is very bad. Those guys need to be accountable for the HIPAA laws.

Kim Matunis [customer]: How can we go about finding out where our medical records are…..I am very afraid!!

LISA [customer]: …I need my records. I am starting the process for Gastric Bypass and I need to prove I was on a program for at least 6 months. My center just abruptly closed also. It is located in a strip mall. I was thinking of finding out from one of the other businesses who would have the key to get in there and call to see if I could go in and get my folder (records)…. I am desperate to get them!!

rose [customer]: …I am going to call the strip mall landlord to see if my records and those of my friends who I referred are still there. If that does not work, I am calling the Attorney General to enforce HIPAA regulations - they took blood so it is PHI - Protected Health Information.) I own CareCall an emergency notification service I started in 1998 and I know all about HIPAA compliance…

Is Pure Weight Loss following proper procedures in handling the confidential files of thousands of members of their 400 weight loss centers? What about credit card information? Is identity theft a concern?

WHAT’S YOUR TAKE? COMMENTS WELCOME.

Also read: IS PURE WEIGHT LOSS VIOLATING HIPAA PRIVACY LAWS? (Part 1)

Pure Weight Loss Members Ask: Where Are My Confidential Records?

* Here’s a SUMMARY OF THE HIPAA PRIVACY RULE issued by the U.S. Department of Health & Human Services

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(FranchisePick.Com) In December, 2007, Pure Weight Loss (formerly LA Weight Loss) announced it was closing all its 400 centers nationwide by Jan. 4., 2008. With no notice and little explanation, Pure Weight Loss left thousands of customers without a weight loss program, without the half-million dollars they’d collectively prepaid for Pure Weight Loss services and products, and with NO information regarding the whereabouts of their confidential financial and health records, which include both credit card data, personal disclosures and blood test results.

The PA Attorney General is suing Pure Weight Loss and PWL CEO Vahan Karian for fraud. But is Pure Weight Loss also guilty of blatantly violating the “HIPAA” Federal privacy law?

According to the SUMMARY OF THE HIPAA PRIVACY RULE issued by the U.S. Department of Health & Human Services:

The U.S. Department of Health and Human Services (“HHS”) issued the Privacy Rule to implement the requirement of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”). 1 The Privacy Rule standards address the use and disclosure of individuals’ health information—called “protected health information” by organizations subject to the Privacy Rule — called “covered entities,” as well as standards for individuals’ privacy rights to understand and control how their health information is used…. A major goal of the Privacy Rule is to assure that individuals’ health information is properly protected…

Violations of the HIPAA Privacy Rule can be substantial, especially the criminal penalties for sharing information with third parties for financial gain:

Civil Money Penalties. HHS may impose civil money penalties on a covered entity of $100 per failure to comply with a Privacy Rule requirement.88 That penalty may not exceed $25,000 per year for multiple violations of the identical Privacy Rule requirement in a calendar year. HHS may not impose a civil money penalty under specific circumstances, such as when a violation is due to reasonable cause and did not involve willful neglect and the covered entity corrected the violation within 30 days of when it knew or should have known of the violation. OCR Privacy Rule Summary 18 Last Revised 05/03

Criminal Penalties. A person who knowingly obtains or discloses individually identifiable health information in violation of HIPAA faces a fine of $50,000 and up to one-year imprisonment.89 The criminal penalties increase to $100,000 and up to five years imprisonment if the wrongful conduct involves false pretenses, and to $250,000 and up to ten years imprisonment if the wrongful conduct involves the intent to sell, transfer, or use individually identifiable health information for commercial advantage, personal gain, or or malicious harm. Criminal sanctions will be enforced by the Department of Justice.

At least one FranchisePick.com commenter mentioned that since blood tests were involved, the information in the Pure Weight Loss files would be subject to HIPAA privacy rules.

Did Pure Weight Loss follow proper procedures in handling the confidential files of thousands of members of their 400 weight loss centers?

Leave your comments below because that’s what our readers will answer in: IS PURE WEIGHT LOSS VIOLATING HIPAA PRIVACY LAWS? (Part 2)

WHAT’S YOUR TAKE? COMMENTS WELCOME.

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(FranchisePick.com)

A good story by Newsday writer Richard J. Dalton provides an all-too-familiar example of a Central Islip couple who could lose $2,200 in advance payments now that the Pure Weight Loss has closed all its centers nationwide. The article also provides information on state rules requiring bonds from health clubs and other member-based businesses - and how Pure Weight Loss (formerly LA Weight Loss) got around them.

Source: Newsday

Pure Weight Loss customers await refunds January 9, 2008

BY RICHARD J. DALTON JR. |richard.dalton@newsday.com

Nancy and Glen Urban of Central Islip have lost 113 pounds combined through Pure Weight Loss, formerly called LA Weight Loss.
Now they worry they may have lost a lot of money and the support that helped them lose the weight, because Pure Weight Loss, based in Horhsam, Penn., shuttered most of its locations last week.
The Urbans are concerned they could lose $2,200 in advance payments, joining many other consumers awaiting refunds.

In 2004, the corporate-owned locations of the LA Weight Loss split off and became Pure Weight Loss, which operated at least nine locations locally, from Forest Hills to Sayville, all of which have closed. Independently owned Pure Weight Loss locations in the southeast will remain open.
After the split, the franchise locations kept the LA Weight Loss name. That chain does not operate locally and could not be reached, but news reports indicate it will remain open. Read the rest of the story.

WHAT DO YOU THINK? LEAVE A COMMENT BELOW.

Also check out:

PURE WEIGHT LOSS REFUND INFORMATION

HOW MUCH DOES PURE WEIGHT LOSS OWE YOU?

PURE WEIGHT LOSS CUSTOMERS: SHARE NEWS & OPINIONS HERE

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