Gym attempting 'sudden closure' due to COVID-19 caught by members... Criminal complaint filed for 'fraud and embezzlement'

The front view of a certain gym located in Gangseo-gu, Seoul, which attempted a 'sudden closure' due to COVID-19. Currently, hundreds of affected members are criminally suing the gym's owner at the Seoul Southern District Prosecutors' Office.

[Asia Economy Reporters Jeong Dong-hoon and Yoo Byung-don] A gym owner who abruptly closed the gym during the period when indoor sports facilities were shut down due to the novel coronavirus infection (COVID-19) was discovered by members and has been criminally sued.

According to a victims' group on the 16th, about 70 members of a gym located in Gangseo-gu, Seoul, filed a complaint against CEO Lee for charges including fraud and embezzlement at the Seoul Southern District Prosecutors' Office. The members formed a victims' group through SNS (social networking services) and are proceeding with the lawsuit after receiving power of attorney. The amount of membership fees not refunded is estimated to be about 200 million KRW.

The gym is a large-scale business with over 500 members. Earlier this month, CEO Lee informed employees of the closure and announced that "there will be no refunds." This was during the period when business was suspended due to the re-spread of COVID-19 and the implementation of "Social Distancing Level 2.5." The gym, which had recruited members last month, also notified members of the closure plan and the fact that there would be no refund plan. The closure was completed on the 4th.

However, the victims claim it was a "pre-planned closure." The gym was sued for eviction due to overdue unpaid rent and management fees, lost the case on the 11th of last month, and had to suspend gym operations by the 28th of the same month. The victim members are outraged, saying that CEO Lee induced long-term memberships despite knowing that closure was inevitable. They also claim that encouraging full payment in cash with promises of discounts was an intention to prepare for the closure.

However, whether membership refunds are possible remains uncertain. The gym’s membership contract terms do not include refund provisions in case of closure or bankruptcy. Civil claims for damages are difficult due to time and cost reasons. Attempts to contact CEO Lee for his position on the matter were unsuccessful.

This content was produced with the assistance of AI translation services.