5 On Your Side

Former owner of Peak Fitness banned from business in NC

Posted May 22, 2012
Updated May 23, 2012

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— A former health club owner can't open a new club in North Carolina for at least 12 years, North Carolina Attorney General Roy Cooper said Tuesday.

The punishment comes after Jeffrey R. Stec repeatedly violated state laws requiring health clubs to maintain a fund to pay back customers with long-term contracts if a club goes out of business.

Stec and his business partners have been the subject of hundreds of complaints over more than six years stemming from clubs called Beyond Fitness and Peak Fitness.

The Attorney General's office sued in 2007, alleging the clubs engaged in deceptive advertising, bounced checks and failed to pay refunds. Stec struck a deal in 2009, promising to provide Cooper’s office with proof that the clubs had the adequate bond money.

Within a year, the clubs filed for bankruptcy. The state sued again, and Tuesday's judgment is a resolution of that suit.

Stec is banned from working in the health club business anywhere in the state, and if he does, he faces a $2 million fine.

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  • peplquitwhinin May 23, 2012

    No surprises here, but the guys that started this are still riding high on the money they screwed so many people out of. None of them are hurting at all. Anybody know the names of
    F the companies they also own in other states?

  • tran May 23, 2012

    "why do people pay for fitness clubs. It don't cost nothing for an invigorating run on trails. If I'm gonna run I going somewere, not just standing looking at a TV."

    If all you are interested in is running, there is no reason to join a fitness club. But if you want to lift weights, a fitness club is the best place to do that.

  • msmithua93 May 23, 2012

    Jeremy Jaynes, an investor, was the 1st person in the US convicted for spam. It all went downhill from there....Like I said...the top guy has to take the fall but really, the Managers and salesguys did all the stealing and stuff. Jeff just got rich.

  • warbirdlover May 23, 2012

    why do people pay for fitness clubs. It don't cost nothing for an invigorating run on trails. If I'm gonna run I going somewere, not just standing looking at a TV.

  • storchheim May 23, 2012

    Yes, let's all rush to that link msmith provided, with the word "spam" actually in it!

  • Bewitched May 23, 2012

    @msmithua93 - I worked at Nautilus Fitness Center (Durham) in the 1980s and their memberships were, and still are, as far as I know, far under $30 a month. I worked at Planet Fitness about 5 years ago, and their memberships are usually $10 a month. So BeyondFitness/Peak didn't start that "affordable" trend. I was also a member of Beyond Fitness (whose air conditioning didn't work half the time, since, as I found out later on, the bills weren't being paid), and I was a member of the North Ridge location of Peak Fitness when its doors suddenly closed without notice (I went to work out one Saturday and the doors were locked). NOTHING about Beyond Fitness or Peak was above board, as far as I'm concerned. Jeff Stec didn't help the fitness industry or customers at all.

  • Wendellcatlover May 23, 2012

    "Stec is banned from working in the health club business anywhere in the state, and if he does, he faces a $2 million fine."
    Sounds like a pointless punishment if he doesn't have that kind of money. There should be a criminal punishment in this case, not civil.

  • uncw05 May 23, 2012

    msmithua93- If the CEO can't stand behind the contracts, it's his job to stop the salespeople from writing them.

  • msmithua93 May 23, 2012

    It was a great ride while it lasted...As a former District Manager of Peak, Mr Stec provided a hard working young man a goal and a skill. I dont know many folks under 23 who cleared $70k...Realistically, Jeff Stec and Peak Fitness changed the face of the industry in NC. A gym membership for under $30 a month, No Contract Memberships, All were created by Beyond Fitness/Peak Fitness. We made exercise affordable for everyone, not just the rich. Unfortunately, with lots of money comes greed and deception. Jeff didnt sign a single agreement. The salespeople did. As the CEO, just like the head coach has to face criticism if the team fails, Jeff gets the blame. Anyone heard of Jeremy Jaymes?? Did you know he was a major investor??? http://www.spamhaus.org/news/article/155

  • pirategrad1202 May 23, 2012

    Maybe Bob B will be next. Find out who runs Anytime Fitness before you join.

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