Victims of a real estate investment scheme involving multiple HGTV stars—including Christina Hall and Tarek El Moussa—have been awarded more than $12 million in refunds by the Federal Trade Commission.
Former “Flip or Flop” stars Hall and El Moussa amassed a huge following thanks to their pioneering reality TV show that featured them buying distressed homes, fixing them up, and quickly selling the redone residences—usually for a profit (but not always).
The ex-couple were among several reality stars enlisted by Utah-based company Zurixx LLC to take part in and promote its home-flipping “seminars” that offered “expert” advice on how to buy, renovate, and sell homes for profit. Some participants are understood to have paid tens of thousands of dollars to take part in these seminars.
However, in 2019, the FTC and the Utah Department of Commerce Division of Consumer Protection sued Zurixx’s owners, Cristopher Cannon, James Carlson, and Jeffrey Spangler. The lawsuit alleged that false earnings claims were used to lure participants into “spending thousands or tens of thousands of dollars in a relatively short amount of time.”
Some participants also alleged that the reality stars used to promote the seminars did not actually attend the coaching sessions, according to Deadline.
(YouTube)
(YouTube)
(HGTV)
Thousands of consumers paid Zurixx to attend real estate investment seminars “that promised students would earn large profits by following its strategies for flipping houses,” the FTC noted in a statement.
Over 25,500 people will be receiving refunds, according to the FTC.
Hall and El Moussa, who were married for nine years until divorcing in 2018, were just two of the TV stars who took part in the promotion of the coaching schemes.
Hilary Farr of HGTV’s “Love It or List It” promoted a similar training program, as did Peter Souhleris and Dave Seymour of A&E’s “Flipping Boston.”
The complaint, according to the FTC, is that the seminars promoted false earnings claims that “convinced consumers to pay them thousands or tens of thousands of dollars in a relatively short amount of time.”
‘It’s our system’
However, in 2017, when ABC reported on customer complaints, the stars defended the program.
“I stand by our product,” Hall told the network. “It’s our tools, it’s our system. It’s what Tarek and I do. I’ve only heard very minimal complaints.”
“Me and #christina on the #big #stage having #fun and teaching folks how to #flip #houses!!” El Moussa posted on Instagram in 2017.
ABC reported on complaints regarding the training material, including an interview with an attendee who was frustrated that the stars weren’t at the seminar.
Hall told ABC at the time, “This is our program. We meet each and every coach, we do training with them one on one. Tarek does tons of training via webinar.”
Pushed to pay
The FTC alleged that Zurixx and its celebrities would first offer free seminars and then push people to pay $1,997 for the course—and would pressure consumers to pay for other seminars and coaching that could cost upward of “tens of thousands of dollars.”
“Preying on struggling Americans with empty promises of quick riches is against the law,” says Samuel Levine, director of the FTC’s Bureau of Consumer Protection.
Zurixx and its owners have been barred from teaching or promoting these programs.
“We urge consumers to stop and evaluate the facts behind any money-making promise before investing their hard-earned money,” Levine advises.
