Millions in refunds headed for customers duped by Utah-based real estate coaching scheme

Homes in North Salt Lake are pictured on Monday, July 15, 2024. (Photo by Spenser Heaps for Utah News Dispatch)

Customers duped by a Utah-based company that promised large profits through its expensive and misleading real estate training program will soon get a refund.

On Wednesday, the Federal Trade Commission and Utah Department of Commerce’s Division of Consumer Protection announced more than $12 million in refunds to 25,563 former customers of Zurixx LLC, a company registered in Cottonwood Heights. 

Both agencies sued Zurixx and its owners, Cristopher Cannon, James Carlson and Jeffrey Spangler, in 2019 for making “false and unsubstantiated” marketing claims, selling courses on flipping real estate that in some instances retailed for almost $74,000, according to court documents. 

To lure customers in, the company would offer a free “teaser” event, the FTC alleged in the lawsuit. The free event was sponsored by various TV real estate and investment celebrities from shows like “Flipping Boston” on A&E, “Love It or List It” on HGTV and “Shark Tank” on ABC, the FTC said. 

Customers were told they would earn thousands of dollars in profit, would receive “100% funding for their real estate investments” and that it would take very little time or effort to make large sums of money, all of which was misleading, the FTC said. According to court documents, the company told clients about “A single mother who spent ‘twenty hours of work, [earned a] $42,000 profit’” on her first deal. 

Ultimately, the free events taught customers “very little,” court documents say, and were instead used to promote a three-day workshop advertised at a “discounted” price of $1,997. Once at the workshop, customers were then told they need to buy one of Zurixx’s advanced packages “in order to make thousands of dollars in profit through real estate investing,” the lawsuit claimed. 

That included Gold, Platinum and Diamond packages, again sold at a “discounted” rate — $21,297, $26,297, and $41,297, respectively. During the seminars, presenters with Zurixx told 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,” the FTC said in court documents. 

When customers would ask for a refund, the FTC said Zurixx would sometimes require them 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.” 

The company and its founders ultimately reached a $111 million settlement with the FTC and Utah Division of Consumer Protection in 2022, which included Cannon, Carlson and Spangler each paying $2.33 million. They were also permanently banned from marketing or selling real estate or business coaching programs. 

The Division of Consumer Protection said in a court filing that much of the company’s business was conducted from its office in Cottonwood Heights, writing that “each of Zurixx’s transactions with consumers has originated from or is inextricably intertwined with Utah.” 

Now, at least some of that settlement money is headed back to Utah, with thousands of consumers set to receive a refund starting in August. 

“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,” Utah Attorney General Sean Reyes said in a statement on Wednesday. “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.” 

Anyone with questions about this case or a possible refund can contact the Utah Division of Consumer Protection at 801-530-6001 or consumerprotection@utah.gov. Consumers can also contact the refund administrator, JND Legal Administration, at 888-906-0593.