The beauty industry has been the center of many of the world’s worst scams, including the ones plaguing the U.S. in recent years.
Now the world has seen a new and potentially devastating scam.
The Shanghai Beauty Salon Association (SGBA), a trade organization, has announced that it will not be charging the usual $3 to $5 for the service, which it says is the norm in China.
SGBA says the new fee will be applied only to “essential services,” and it will no longer apply to “in-store and at-home services.”
The SGBA is also saying it will be imposing a 10 percent surcharge on orders of $250 or more.
SGABA’s announcement comes just two days after the New York City-based cosmetics retailer L’Oreal agreed to a $500 million settlement with Chinese authorities.
That agreement, which was widely seen as a victory for the cosmetics industry, resulted in the removal of the 10 percent charge.
But the new settlement was widely criticized for not protecting consumers from the same kinds of scams being perpetrated by the Shanghai Beauty Association.
SGBCA’s news release says SGBA will be expanding its services, which include a mobile app that allows customers to pay for cosmetic procedures in their own names and to use payment options such as debit and credit cards.
It says it will also be adding a payment processor that can be used for other payment services.
SGBAs new announcement comes a week after the Los Angeles-based beauty giant Sephora agreed to pay $6.4 million to settle charges of paying its employees in exchange for their loyalty programs.
Sephoras former CEO, Lisa Gagosian, said in January that she believed her company was not using the practice because it was a way for Sephors customers to “pay their bills.”
Sephores new settlement, meanwhile, is expected to affect as many as 7,000 workers at the cosmetics retailer.