For massage therapists in the State of Texas there is a code of ethics that must be adherred to and requiring them to perform all massages in a sanitary work environment, while also prohibiting professionals from offering therapy in an unlicensed salon, parlour or school.
Now I know of legititmate (non hobby related) massage therapists who do practice out of their home or will share an office and none of them have ever been faced with what the OP is describing. In addition the health department in Texas is extremely short handed and has enough problems trying to regulate every massage therapist. The last I remember seeing online somewhere is that there is only 1-2 inspectors for the whole State of Texas.
Sanitary means you have all the equipment /tools necessary for sanitizing (alcohol spray or diluted bleach spray) for table and face cradle, or a hydrocollator machine, cold packs.. the area does have to meet some cleanliness guidelines. You must have a washing facility with running water.. a place to put soiled sheets etc.
If you are in a salon or an office setting where there are more than one licensed massage therapists advertising they have to be under an MEL (massage establishment license) which comes under other guidelines.
Generally if they are going to go after someone who is practicing unlicensed (health inspectors that is, which is very very rare) it will be to fine the person for being unlicensed or flat out arrest them. Let me also add that in the State of Texas licensed massage therapists are required by law to keep a consult form on every client. It is a 10,000 dollar fine for every client that they do not have a consult form on file for.
I would tell your friend to be very very careful with something like this because it sounds very fishy, suspect to me.
Link to Texas Massage Therapy law Scroll down to Rule 141 52 as to sanitation requirements and facility