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FTC Shuts Down Real Estate Seminars Endorsed by Flip or Flop Stars

Illustration for article titled FTC Shuts Down Real Estate Seminars Endorsed by iFlip or Flop/i Stars
Image: AP

The FTC has put a stop (temporarily at least) to real estate seminars endorsed Flip or Flop stars Tarek El Moussa and Christina Anstead and other “flipper” TV personalities, alleging misleading and deceptive business practices.

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The Hollywood Reporter said that a court has issued a restraining order against the “free” programs by an organization called Zurixx LLC, as well as freezing the company’s assets. The FTC complaint accuses the Zurixx of “deceptive promises of big profits to lure consumers into real estate seminars costing thousands of dollars,” and the commission explained:

Zurixx purports to offer consumers coaching and training on how to make large sums of money by buying houses and quickly updating and reselling them, a practice known as “flipping.” Its advertisements routinely feature endorsements from celebrities like Tarek and Christina El Moussa from HGTV’s “Flip or Flop,” Hilary Farr from HGTV’s “Love It or List It,” and Peter Souhleris and Dave Seymour from A&E’s “Flipping Boston.” The ads entice consumers to free events that Zurixx claimed would teach consumers how to make large profits by flipping “using other people’s money.”

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“From start to finish, these defendants used the promise of easy money and in-depth information to lure consumers down a path that could cost them thousands of dollars and put them in serious debt,” said Andrew Smith, director of the FTC’s Bureau of Consumer Protection. Zurixx said in a statement they anticipate “a positive outcome as we work directly and openly with the agencies involved.”

How it played out, the Hollywood Reporter explained:

In its complaint Friday, the FTC said that Utah-based Zurixx LLC would hold free real estate events endorsed by HGTV stars, including Tarek El Moussa and Christina Anstead of Flip or Flop fame. But at the events, attendees would be asked to pay for another three-day class that cost $1,997. And those who paid for those classes would be taught how to apply for new credit cards and increase the credit limits on existing cards. Then, according to the FTC, instructors would suggest using the credit to pay for additional training that cost more than $41,000.

The FTC also alleged that anybody who got a refund was required “to sign 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 about Zurixx.”

Also? Too many chevrons and too much teal.

Senior Editor, Attic Haunter, Jezebel

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DISCUSSION

These seminars are like the drug dealers of real estate — “first one’s always free.” I did attend one many years ago just out of curiosity, and based on that experience and what I’ve heard from others, the game plan is always the same. You will learn absolutely nothing in that initial free seminar, but that’s because its purpose is to show you a bunch of pipe dream success stories and get you salivating to get your foot in the door of real estate investing. And while you’re still hot, they will direct you to tables at the back of the room — tables right next to the exits — where you can fork over money for the “real” secrets/lessons/mentorship. Obviously, if you made it as far as the seminar, this is the stage where you need to ignore the tables and head straight for the exits.

A lot of successful real estate investors who gain a certain level of celebrity eventually hook up with this seminar bullshit, and they know what they’re getting into. Basically, if your favorite real estate investor is doing these seminars, they’ve gotten to the full-on greedy as shit stage of their career.