All that glitters isn’t gold, and according to the Federal Trade Commission and the Utah Division of Consumer Protection, that saying holds for what the FTC describes as “bogus” real estate-flipping seminars hosted by Salt Lake City-based Zurixx.
In a complaint filed on Sept. 30, the FTC and the Utah Division of Consumer Protection allege Zurixx made unsubstantiated marketing claims about their home flipping seminars featuring HGTV stars Tarek El Moussa and Christina Anstead from Flip or Flop, Hilary Farr from Love It or List It, and Peter Souhleris and Dave Seymour from Flipping Boston.
“To entice consumers to purchase its products, Zurixx routinely hosts free live events that depict celebrities from house flipping and home renovation television programs, who indicate that their team of ‘experts’ will teach consumers how to make money by following their system of real estate investing,” the court documents read.
The complaint asks for injunctive relief, reformation of contracts, restitution, consumer refunds, and the payment of civil penalties, fines and “other equitable relief.”
According to its website, Zurixx specializes in producing and hosting three-day workshops about business growth and management, asset protection, real estate, and personal finances. In an explainer, the company says the free events simply provides “the information they need to decide whether our programs are the right fit.”
However, the FTC and DCP say Zurixx’s advertising leads consumers to believe they’ll receive free house flipping advice from HGTV stars, when in fact, the events are a sales pitch for a three-day paid workshop.
At the free events, Zurixx presenters encourage consumers to sign up for a $1,997 three-day beginners’ workshop. The presenters also upsell advanced programs that total $41,297. To afford the cost, Zurixx allegedly encourages attendees to provide inflated income information to obtain new credit cards and receive limit increases for existing accounts.
The Federal Trade Commission and Utah Division of Consumer Protection also state Zurixx offers a six-month guarantee that each attendee will experience a return on investment that’s at least three times greater than what they paid.
“Zurixx also represents that consumers who purchase the workshop will receive 100 percent funding for their real estate investments regardless of their credit history,” the FTC said in its complaint.
“It backs up these representations with a money-back guarantee – consumers who do not make ‘a minimum of three times’ the price of the three-day workshop within six months will receive their money back.”
Lastly, the FTC and DCP say Zurixx requires consumers to sign illegal contracts that prevent them from filing complaints or writing negative reviews, a requirement that violates the Consumer Review Fairness Act.
Despite the number of success stories shared during the free events, the majority of consumers seem to be displeased with Zurixx, which currently has a D+ rating with the Better Business Bureau.
The company has had 105 closed complaints since 2016, with 29 closed complaints being filed within the past 12 months. The complaints support FTC and DCP’s claims and include stories about HGTV stars not attending events, Zurixx’s confusing cancellation policies, and consumers’ financial issues after racking up credit card bills.
“I received at the time of purchase, a double your money or you get a money-back guarantee,” wrote one consumer who remains anonymous. “I have a written agreement. I purchased this package at a three-day seminar. I paid in full. I began the training. I kept hearing that you will make money.”
“After close to 90 days and no success, I was contacted by [a Zurixx case manager]. He began to upsell me more coaching for $8K. He passed me to [another manager] who accepted my payment,” they added.
The consumer went on to explain they were unsatisfied with the advanced video trainings and followed the three-day cancellation policy. They then claimed the case manager failed to answer calls, pushing them past the three-day cancellation window.
“I am now feeling like this is some kind of financial scheme. I would never have signed up if I had no guarantees,” the person concluded. “My first payment was $14,297. The upsell coaching cost, I paid $4,000. The total amount is $18,297.00. I have a written money-back guarantee. I have made no money.”
Zurixx, which did not immediately respond to a request for comment by Inman, did reply to the complaint, saying the company came to a “mutual settlement agreement.”
Despite the claims made by the agencies, and consumers, HGTV star Christina Anstead stands by her support of the program.
In an interview with ABC, Anstead said she attends Zurixx’s seminars located near her home in Newport Beach, Calif. and will occasionally travel to out-of-state events.
“If it’s going to be within 45 minutes from my house I’m definitely going to come,” she said in 2016 when the claims against Zurixx started. “It gets harder to travel all around, especially [because] we have two kids.”
She also said Zurixx doesn’t mislead consumers about her or her ex-husband Tarek El-Moussa’s attendance. “Nowhere on any other marketing does it state the El Moussas will be live and in-person at any event,” she noted.
“I stand by our product,” she concluded. “It’s our tools, it’s our system. It’s what Tarek and I do. I’ve only heard very minimal complaints.”
FTC and UDCP’s motion for a Temporary Restraining Order to prohibit Zurixx from making false marketing claims and blocking negative consumer reviews was granted on Oct. 7.
A trial date has yet to be set.