Customers were getting more than herbal cures at the Chinese health medicine shop down Petticoat Lane—more like “services of a sexual nature”.

Prostitutes were plying their trade using the premises in Aldgate for soliciting, Thames Magistrates Court heard.

The owners, Cheng Xiang Chinese Medicine, trading as ‘Health One’, were found guilty of breaching terms and conditions of their “special treatment” licence by allowing prostitutes to use premises in Middlesex Street for “soliciting or any other immoral purposes”.

Evidence which included an account from a ‘client’ who was offered “services of a sexual nature” was presented to the court on June 19 by the council’s legal team and its environmental health and trading standards service.

The defendants argued that the sexual services offered were not prostitution as they did not involve full sexual intercourse. But the court rejected their argument.

The company was fined £1,250 with another £2,000 legal costs and £125 ‘victim surcharge’.

The premises still have a licence to provide “special treatments”—but is now being monitored by Tower Hamlets trading standards office to make sure they are not breaching the terms.

“We’ll carry out enforcement where businesses are operating outside their licence to trade,” mayor John Biggs warned after the case. “This prosecution shows that businesses in the East End have to abide by the rules or face consequences.”

The council threatens to revoke Cheng Xiang’s trading licence through its licensing committee if they breach the terms.

It is an offence to offer “services of a sexual nature” under the 1991 London Local Authorities Act and the council’s own trading regulations in a ban on immoral use of premises, the council warns.

Cabinet member David Edgar said: “We will take further action if needed, to stop businesses breaching their licences.”

Premises providing “special treatments” such as massage, laser treatments and tattooing have to be licensed by the local authority unless they are eligible for an exemption if they belong to a recognised membership body.

But “services of a sexual nature” on such premises is an offence under the 1991 Act governing special treatments.