Real estate seminars backed by HGTV stars under fire by FTC
A federal court judge has issued a temporary restraining order against a Utah-based company that hosts celebrity-backed real estate seminars after the Federal Trade Commission determined they made "deceptive promises of big profits," according to an official press release.
The FTC claimed in court papers on Friday that Zurixx LLC was misleading its customers by hosting free seminars where they promised they could help people get rich. The seminars were endorsed by HGTV “Flip or Flop” stars Tarek El Moussa and Christina Anstead, and Hilary Farr from HGTV’s “Love It or List It,” according to the complaint. Neither El Moussa, Anstead or Farr was named as a defendant in the complaint.
"HGTV, its sister networks, and its parent company are neither associated or affiliated with Zurixx, nor are we involved in any of our talents' personal business associations with Zurixx," the network said in a statement.
The temporary restraining order prohibits the company from "interfering with the consumers' ability to review Zurixx and its products" and from making false or unsupported claims. A temporary monitor was hired to oversee the company's activity, according to the FTC.
“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. “When a company tells consumers they have the secret to get rich with little work, we encourage consumers to take a hard look at what’s really being offered.”
In an emailed statement to FOX Business, A Zurixx spokesperson said the company is proceeding with normal business, despite reports that they had been ordered to halt operations.
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"Zurixx has always been, and will remain, a positive, compliant and student-focused business in the marketing, selling and delivering of our education products," the statement reads. "We are aware of the formal inquiry by the FTC and the State of Utah, we welcome the scrutiny and anticipate a positive outcome as we work directly and openly with the agencies involved.”
Zurixx curates “free comprehensive educational events, three-day workshops, advanced training camps, summits, coaching and mentorship programs in the areas of business growth and management, asset protection, real estate and personal finances,” according to the company’s website.
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 costs more than $41,000.
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The Associated Press contributed to this story.