Consumers Defrauded by Zurixx Real Estate Investment Scheme to Receive $12 Million in Refunds

July 30, 2024, Salt Lake City, Utah

The Federal Trade Commission (FTC) announced this week it is mailing checks to consumers harmed in the Zurixx, LLC real estate investment coaching scheme. These payments are the result of the $12 million settlement between the FTC and the Utah Division of Consumer Protection with Zurixx in 2022.

“Many victims will finally be getting some justice. Thousands who were coached into fraudulent investments by Zurixx owners will receive checks from this substantial settlement,” said Utah Attorney General Sean Reyes. “Removing these actors permanently from the coaching space is a significant win for Utah. We hope this serves as a warning to others who might consider setting up similar programs based on false earning claims. It remains one of my highest priorities to prosecute white-collar offenders. We are grateful for our partnership with the FTC and the Utah Division of Consumer Protection in this case.”

The FTC and the Division of Consumer Protection filed a lawsuit against Zurixx and its owners, Christopher Cannon, James Carlson, and Jeffrey Spangler, for misleading consumers with false earnings claims during seminars and coaching sessions. The scheme promised large profits from real estate "flipping," using celebrity endorsements to attract customers. The lawsuit resulted in $12 million in refunds for 25,563 consumers and a permanent ban on the defendants from selling real estate or business coaching services.

According to the Utah Department of Commerce, the defendants grew revenue by partnering with home-improvement and flipping television celebrities. The FTC and DCP alleged that defendants used hard-sell telemarketing tactics promoting the idea that consumers could make tens or hundreds of thousands of dollars in a relatively short amount of time by “flipping” or wholesaling real estate using Zurixx’s system. The celebrities connected with Zurixx marketing efforts included, among others, Tarek and Christina El Moussa, Hilary Farr, Peter Souhleris, and Dave Seymour. 

Zurixx and its celebrities invited consumers to free “seminars” that, the FTC and DCP allege, were in fact high-pressure sales events for paid seminars that cost nearly $2,000. Thereafter, the defendants pushed more expensive seminars and coaching that could cost tens of thousands of dollars. According to the FTC and DCP, presenters at the seminars encouraged consumers to open new credit cards to pay for the training, promising that the profits from flipping or wholesaling homes would quickly pay off the new debt. 

FTC and DCP also alleged that 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.

“This is a big win for not only the victims harmed in this scheme but all consumers,” said Executive Director Margaret Busse. “When businesses take advantage of the public’s trust, it hurts the health of the economy and makes people less likely to participate in commerce. Stopping operations like this is crucial to building the trust essential to making our economy work for everyone.”

Eligible consumers should begin receiving settlement checks from the FTC starting in August. Recipients should plan on cashing those checks within 90 days of the issue date. Consumers with questions about this case should contact the Utah Division of Consumer Protection at 801-530-6001 or via email at consumerprotection@utah.gov.

For additional details or to file a complaint, please visit https://dcp.utah.gov/.

In 2018, Zurixx CEO James Carlson was named CEO of the Year by Utah Business. Zurixx LLC is now a defunct entity and has been placed in receivership. David K. Broadbent of the law firm Holland and Hart has been appointed as Receiver. An informational video about the company still exists on YouTube. The company's website is no longer active.