DATE: Wednesday, October 29, 1997           TAG: 9710290621

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 
SOURCE: BY MIKE ABRAMS, STAFF WRITER 
DATELINE: VIRGINIA BEACH                    LENGTH:   64 lines

DISCOUNT CLUB CLOSES DOORSAFFORDABLE LIFESTYLES FACES DOZENS OF COMPLAINTS FROM CUSTOMERS WHO CLAIM THEY DIDN'T GET GOODS.

A discount buying club that at one time had 13,000 members has quietly closed its doors under pressure from customers and the Internal Revenue Service.

Affordable Lifestyles, which promised big discounts on furniture, electronics and appliances, faces dozens of complaints from customers who said they paid for products they didn't receive.

The state attorney general's office is investigating the matter, and the IRS is due $80,000 in back taxes, the club's Norfolk attorney, W. Greer McCreedy, confirmed Tuesday.

But the lawyer said the owners haven't been running a scam.

``It's not a situation where the owner is living high on the hog while his customers go wanting,'' McCreedy said. ``Certainly, people are going to lose money out of this, but not as much as the owners.''

Founded in 1972 by the late Harold Pugh, Affordable Lifestyles billed itself as the oldest discount membership club in Hampton Roads. The store operated under the name Uniway until 1991.

Members paid upwards of $900 to join and annual dues of $65. The company operated a 3,000-square-foot showroom off Indian River Road.

A hand-written sign at the showroom's front door informs customers to direct questions to the lawyer's office at 627-8365. The club's phone has been disconnected, and it does not have a current city business license.

In the club's heyday, customers could peruse catalogs for most merchandise, then place orders. Delivery took from several days to more than two months.

Pugh died in 1988, and his son, Timothy, took over as president.

McCreedy, speaking on behalf of his client, said the owner and his relatives began having problems late last year. He wouldn't discuss the nature of the difficulties.

To try to save the company, he said, the owners poured hundreds of thousands of dollars into the venture. They voluntarily closed the operation in early October to avoid IRS seizure of the inventory.

The membership, however, had dwindled to about 7,000.

The owners plan to hold a public auction next month to raise money to cover the debts.

In the meantime, McCreedy said, Timothy Pugh has lost his home and his inheritance.

``The owners of this thing,'' the attorney said, ``really have gone the extra mile.''

Even so, the Better Business Bureau of Greater Hampton Roads and the Virginia Beach commonwealth's attorney's office have received complaints from club members since late 1996.

Cathy Parks, director of the consumer affairs division of the commonwealth's attorney's office, said she received 37 such complaints from people who said they paid for goods they never received. The amounts ranged from a few hundred dollars to several thousand dollars.

``We felt there could be some consumer protection violations,'' she said.

Parks forwarded the complaints to the state attorney general in May. That office does not comment on investigations.

If found liable, the company could face fines and be forced to pay back customers.

The Better Business Bureau, a non-profit membership organization, received complaints similar to those reported to the state.

In fact, a recorded bureau phone message about the club warns of unresolved customer complaints, high-pressure sales tactics and misrepresented discounts.

Send Suggestions or Comments to webmaster@scholar.lib.vt.edu