Have you heard those radio ads for house-flipping seminars endorsed by HGTV stars? Did the sales pitch sound too good to be true? The Federal Trade Commission (FTC) thinks so.
The FTC filed a complaint against Zurixx, a company that hosts real estate seminars endorsed by “Flip or Flop” stars such as Tarek El Moussa and Christina Anstead and “Love It or List It” host Hilary Farr, and others. According to the FTC complaint, Zurixx makes a number of claims that are “false” or “unsubstantiated.”
In promoting free seminars, Zurixx says its team of experts will teach consumers how to make money with their real estate investment system. The use of celebrity endorsements, and the careful wording of the ads, leads many seminar attendees to believe the HGTV stars will be part of the training.
But the free events turn out to be little more than high-pressure sales pitches to get people to buy paid workshops. According to the FTC, Zurixx repeatedly tells consumers they “are likely to earn thousands of dollars in profit, often with little risk, time, or effort,” and that “consumers who purchase the workshop will receive 100 percent funding for their real estate investments regardless of their credit history.”
The complaint also suggests that Zurixx refund claims are misleading. Consumers are told they can receive their money back if they do not make a minimum of three times the price of the three-day workshop within six months.
Customers report that the refund requirements are onerous and aren’t adequately disclosed beforehand. Moreover, to receive a refund, consumers must sign away certain rights.
According to the complaint, “When Zurixx agrees to refund consumers’ money, it routinely provides only a partial refund, which in many instances, Zurixx conditions on the consumers signing an agreement barring them from speaking with the FTC, state Attorneys General, and other regulators, submitting complaints to the Better Business Bureau, or posting negative reviews or complaints about Zurixx and its products.”
The complaint does not bar Zurixx from conducting business operations. An inquiry is under way.