Some spas in very shaky financial shape: CASE

Don't buy a treatment package unless the service provider insures your pre-payment as some spas are in bad financial shape.

That was the message of the Consumers Association of Singapore (CASE) on Monday, when it announced that 57 out of 178 CaseTrust accredited spas had put in place insurance facilities to protect consumers' pre-payments.

In implementing the CaseTrust spa protection scheme, which kicked in on 1 October, CASE said in a statement that it discovered that some spas collecting pre-payments from consumers  are in "very shaky financial positions and are also engaging in questionable financial practices".

It said one spa service provider was operating at an expected annual loss of nearly $1 million, and yet its directors were borrowing $1.6 million from the company for personal use.

"Consumers being unaware of the company's actual financial health and practices may be exposing themselves to a greater risk of having their pre-payments forfeited by patronising such spas that have a greater possibility to fold up," it said.

With a spa protection scheme in place, consumers are assured a refund of the unutilised portion of their pre-payments, including pre-paid packages, in the event of the spa's closure.

To be sure they are protected, patrons should get a certificate of insurance for every pre-payment, CASE advised.

The agency also disclosed that 66 CaseTrust accredited spas have declared they do not sell pre-paid packages, and that 55 accredited spas are working closely with protection scheme providers to meet the protection scheme requirements of the CaseTrust for the Spa and Wellness Businesses accreditation scheme.

Moreover, six non-accredited spas with insurance facilities in place are applying to be accredited with CaseTrust.

Consumers can refer to the CaseTrust website at www.casetrust.org.sg for the lists of spas with the spa protection scheme in place and the list of spas that have declared non-selling of pre-paid packages.