Flipping houses is very popular in Florida, and many seminars suggest the potential for high profits. But are the claims of earning large sums of money true?
The Federal Trade Commission is cracking down on Utah-based company Zurixx LLC and its affiliated companies, accusing them of using "deceptive promises of big profits to lure consumers into real estate seminars costing thousands of dollars."
According to the FTC's website, "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.'"
Zurixx claims to offer consumers coaching and training on how to make large sums of money by flipping houses, the FTC said.
"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,'" FTC posted on its site.
FTC officials said the ads "entice consumers to free events" that Zurixx claimed would teach them how to profit by flipping homes "using other people's money."
"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," director of the FTC's Bureau of Consumer Protection Andrew Smith said.
A complaint filed by the FTC alleges that the company's free event is a sales presentation for its three-day workshops that cost $1,997. The FTC said that once consumers pay for and attend the three-day workshop, Zurixx officials "have often described it as merely a 'beginner' course, while upselling consumers additional products and services that can cost as much as $41,297."
"When a company tells consumers (that) they have the secret to get rich with little work, we encourage consumers to take a hard look at what's really being offered," Smith said.
Susan Martin said she paid for one of those three-day seminars in California that cost almost $2,000.
She said there were flashy presentations and pushes to get attendees to sign up for even more expensive events.
"It didn't strike me as legitimate," Martin said.
Martin said she was given a refund after complaining, and she hopes others learn from her experience.
The FTC accuses Zurixx of requiring some consumers who received a refund 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."
According to the FTC's website, Zurixx is accused of violating the FTC Act's "prohibitions on misleading and deceptive conduct and the Consumer Review Fairness Act, as well as the Utah Consumer Sales Practices Act and the Utah Business Opportunity Disclosure Act."
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