FTC Issues $12 Million in Refunds to Consumers Defrauded by Zurixx, LLC

There’s bad advice…and there’s bad advice that can cost you eye-watering amounts of money. 

The crucial difference between those two is something at least 25,563 consumers learned from their experience with Zurixx, LLC. 

On February 16, 2022, the Federal Trade Commission (FTC) announced a settlement in the lawsuit filed with the Utah Division of Consumer Protection in September 2019 against Zurixx, LLC, who agreed to permanent bans as well as $12 million in consumer redress. 

Monetary judgments in the settlement totaled over $111 million. 

Fast forward to July 31, 2024, and the FTC announced it was sending more than $12 million in refunds to the consumers who paid Zurixx for a “real estate investment training program” that promised massive returns by “flipping” or wholesaling properties. 

They even partnered with known house-flipping celebrities to bolster their credibility. 

But despite the threat of legal action against customers who left negative reviews or reported them to the FTC or the Better Business Bureau (BBB) after receiving a refund from Zurixx, word got out. 

Read on for the details. 

The Case Against Zurixx, LLC

Nearly five years ago, in September 2019, the FTC and Utah Department of Commerce Division of Consumer Protection sued Zurixx, LLC for making false earnings claims in a real estate investment coaching scheme. 

Defendants included Cristopher Cannon, James Carlson, and Jeffrey Spangler. 

Zurixx allegedly promised its customers large profits through house flipping or wholesaling. They even partnered with home-improvement and house-flipping celebrities who pushed the same marketing message. 

Those celebrities included, among others, Tarek and Christina El Moussa, Hilary Farr, Peter Souhleris, and Dave Seymour. Together with Zurixx, these TV personalities invited consumers to free seminars that, as the FTC and UDCP have alleged, were high-pressure sales events for paid seminars costing $1,997. From there, Zurixx pushed pricier seminars and coaching programs with five-figure price tags. 

Customers paid thousands or even tens of thousands of dollars for the Zurixx coaching program. And according to the FTC complaint, presenters at the Zurixx seminars encouraged attendees to open new credit cards to pay for the training, assuring them the profits they would make from flipping or wholesaling homes would quickly allow them to pay those debts off. 

As for customers who found otherwise and sought a refund, Zurixx imposed conditions that ultimately backfired on them. 

From the FTC press release on the settlement:  

“Zurixx required consumers who received refunds to sign agreements 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.”

In spite of that agreement (and the implied threat of legal action) word got out that the program wasn’t all it was made out to be. 

Spending thousands of dollars on coaching isn’t a problem in itself. But it seems enough people felt tricked by Zurixx into signing up for a program that didn’t deliver on its promises. 

Settlement Terms

Zurixx agreed to a settlement in February 2022. 

From the FTC press release: 

“Under the terms of the settlement, the defendants are permanently banned from marketing or selling any real estate or business coaching programs. They are also barred from further violations of the FTC’s Telemarketing Sales Rule and Utah’s Business Opportunity Disclosure and Telephone Fraud Prevention Acts. In addition, they are barred from making misleading earnings claims and from using contract terms to restrict consumers’ ability to review their products or speak to law enforcement agencies.” 

Monetary judgments totaled more than $111 million and included— 

• $104.7 million against the corporate defendants in the case, which are now defunct and “under receivership with remaining assets totaling approximately $5 million, which will be used for partial satisfaction of the judgment against them.”
• $2.33 million against Cristopher Cannon and entities associated with him (CAC Investment Ventures, LLCUtah, and CAC Investment Ventures, LLC-Puerto Rico).
• $2.33 million against James M. Carlson and entities associated with him (Carlson Development Group, LLCUtah, and Carlson Development Group, LLC-Puerto Rico).
• $2.33 million against Jeffery D. Spangler and entities associated with him (JSS Investment Ventures, LLC and the JSS Trust).

The stipulated final order was approved 4-0 by Commission vote, with the U.S. District Court for the District of Utah entering the order approving the settlement on February 15, 2022.

The FTC is now sending more than $12 million in refunds to a total of 25,563 consumers defrauded by Zurixx. As of yet, we don’t know whether any of the TV personalities mentioned have been sued. 

Read the full press releases on the settlement and payout for more details.