I know too much about Tarek and Christina, the now-divorced couple who star in HGTV’s Flip or Flop show.
I know about their marital split. I know about Tarek’s supposed emotional breakdown. I know about Christina’s new marriage and newborn baby. I even know Tarek has a new girlfriend.
But The Watchdog’s interest in the couple stems not from any love of real estate or quasi-celebrities, but from my 2016 visit to a hotel sales seminar to which the couple lent their names.
They didn’t show up, but their names were dropped enough times by hucksters who work to persuade dreamers to invest thousands in their house-flipping system.
I thought it was as shady as a rainy day.
Now I know something else. The Federal Trade Commission calls the entire operation a scheme designed to lure fans of the show into spending up to $40,000 to learn how to flip homes the Tarek/Christina way.
Tarek el Moussa and ex-wife Christina Anstead are not named as defendants in the government’s legal action, but they and their show are referred to in the court papers.
FTC lawyers persuaded a federal judge to issue a temporary order to stop operations of the sales company, Zurixx of Utah. The judge also ruled that a court-appointed monitor must step into the company’s operations and help clean up this flop.
No comment from Zurixx or from Tarek and Christina. I left messages at their respective offices.
But it’s worth noting that when I originally studied them, the couple answered my reporting with a 27-second YouTube video called “HGTV Stars of Flip or Flop respond to The Watchdog.”
They said in the video they were busy doing charity work and couldn’t attend the seminar I attended.
“Everybody is happy at the end of the day,” Tarek says in the video.
“Maybe we’ll see you at a future event, Watchdog,” Christina says.
For the record, not everyone is happy, and the only place I see the couple now is on the telly.
In a statement to The Watchdog, HGTV spokeswoman Amy Hammontree writes: “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.”
Promises don’t pan out
Turns out the sales seminars are like the houses they flip. At first, they look promising, but once you start looking behind the walls, all manner of problems pop up.
Reminds me of how Tarek knocks outdated kitchen cabinets with his sledgehammer. That’s what the government is trying to do here.
Court papers filed by the government knock the ethical failures of Zurixx and its affiliated companies.
According to the FTC, a salesman trying to sell the program promised that Tarek and Christina’s “lending partners will fund 100 percent of the real estate you buy, fund 100 percent of the rehab, regardless of your credit or background.” The government says that’s not true.
The goal of the salespeople, the FTC alleges, is to get people to max out their credit cards to pay for advanced classes that cost $40,000.
Another salesman said, according to the FTC: “They [Tarek and Christina] are going to give you a professional education.”
The government charges that those promises are “not likely” to pan out.
Three years ago, James Carlson, the top guy at Zurixx, acknowledged to me that many customers attend the initial free sales seminars because the invitations leave the impression the couple will attend.
“Obviously, a lot of people think that,” he said at the time. “We’ve got our marketing reviewed. It’s not false and doesn’t contain any inaccuracies.”
Andrew Smith, the FTC’s director of consumer protection, said in a written statement, “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.
“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.”
Tarnish their name
What saddens me about this is that the couple felt the need to make more money and tarnish their name.
Their show has been wildly successful and continues to do well even though they’ve divorced. Postmarital tensions keep the show interesting.
As one of HGTV’s top shows, they deserve credit for showing millions of viewers ways to make money in real estate and how to design and decorate homes.
But it appears that their ethics have sprung a leak, and — like what happens on the show — that’s going to cost them.