DATE: Saturday, November 22, 1997           TAG: 9711220295

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY MIKE ABRAMS, STAFF WRITER 

DATELINE: VIRGINIA BEACH                    LENGTH:   74 lines

DEFUNCT DISCOUNT CLUB AUCTIONS GOODS SOME MEMBERS NEVER RECEIVED THEIR MERCHANDISE.

Bargain hunters and irate customers crammed into the Affordable Lifestyles showroom Friday, as the defunct buying club's merchandise went on the auction block.

The debt-laden club closed quietly in October under mounting pressure from the Internal Revenue Service, state investigators and angry customers who said they paid for products they never received.

Thousands of members of the 25-year-old organization paid up to $1,000 to join in exchange for the opportunity to buy collectibles, electronics and furniture at huge discounts.

Friday's auction began at 10 a.m. and continued into the evening inside the club's facility off Indian River Road. People bid on figurines, televisions, bar stools, beds, picture frames and the company's own furniture.

One item - the refrigerator in an employee lounge - contained a box of doughnuts, a half-eaten package of ice cream and a carton of milk stamped with a June date.

That appliance, and an adjacent clogged sink filled with dirty dishes, revealed the club's quick and mysterious closure.

``I had no idea that they were in financial trouble,'' said Linda Dennis, a Norfolk resident and member for three years. ``I came to collect my merchandise.''

She was unsuccessful.

On July 30, she paid by check and credit card in advance for a mattress set and night stand she never received.

About 13 weeks after placing her order, she received a letter from the state attorney general's office inquiring about her experience with the business.

Friday, she questioned the attorney who represents the club, W. Greer McCreedy. She also checked to see if her furniture was on location.

She left empty-handed.

McCreedy said his Norfolk law office has received about 200 phone calls in the past few weeks from members with similar frustrations.

The club's priority, he said, is to pay the IRS $80,000 in back taxes, cover lapsed business license fees to Virginia Beach and pay off other operating debts.

Hearing that didn't satisfy Penney and Larry Agee, club members for three years. They stopped by to find out what had happened to a formal dining room set they paid nearly $1,500 for in June.

They, too, left unhappy.

``They have to pay us,'' Larry Agee said. ``Otherwise, it's stolen merchandise.''

In its heyday, Affordable Lifestyles had about 13,000 members. The late Harold Pugh of Virginia Beach founded the club in 1972 under the name Uniway, which has outlets around the country.

Pugh died in 1988, leaving the business to his son, Timothy, who hasn't responded to multiple interview requests.

Competitive pressures, customer complaints about high-pressure sales tactics and lengthy shipping delays gradually led to the club's demise.

It was unclear how much money the auction, with its seemingly low prices, would produce.

One woman made off with a two-piece designer luggage set for $35, another bidder paid $3 for a small wood table and another person purchased a dressed mannequin for $5.

Many visitors said they were unfamiliar with the circumstances surrounding the club's downfall and didn't really care.

``You feel sorry for people who got involved and didn't get their stuff,'' said Glenn Maynard, a used-car salesman looking for a good deal on office chairs. ``But we're here, like anybody else, to get a good bargain.'' ILLUSTRATION: Color Photo

Steve Earley photos/The Virginian-Pilot

Michael Bradshaw...

Jane Elmer... KEYWORDS: AUCTION

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