[00:00:03] Tarek and Christina’s lending partners will fund 100% of the real estate you buy.
Fund 100% of the rehab regardless of your credit or your background.
Ever wondered what happens in those ballrooms?
Well, today we’re going to find out thanks to a man we’ll call Dave.
Dave lives near Dallas, and a few years ago he receives one of those postcards in the mail.
It says he’ll learn how to change his financial fortunes overnight.
But it isn’t the easy money that catches his eye, it’s the TV stars.
[00:01:25] Bob: Yes, that Tarek and Christina.
Tarek and Christina might be the biggest stars on HGTV.
So Dave, tempted by the chance to meet them decides to go.
He’s not alone.
Plenty of Dallas area residents are drawn to Tarek and Christina like moths to a flame.
[00:02:00] Bob: Do you talk to any of them?
They want to become rich.
[00:02:14] Bob: They, they want to become Tarek and Christina, right?
[00:02:16] Dave Lieber: Yep.
That opportunity presents itself right away, sort of.
[00:02:50] Dave Lieber: Well, somebody else comes out.
And they sweeten the deal.
[00:03:32] Dave Lieber: No.
[00:03:41] Bob: The hosts then launch into their presentation.
How you’re going to become a millionaire?
How you’re going to, you know, your friends are going to love you.
You’re going to have a boat; you’re going to go on vacations.
And so they paint this picture of wealth and then they ease into the particulars.
[00:04:12] Bob: How do you get that wealth?
The boats, the friends, the lifestyle?
Well, by flipping houses using other people’s money.
The hosts are working with a company named Zurixx.
[00:04:30] Tarek and Christina’s lending partners will fund 100% of the real estate you buy.
Fund 100% of the rehab regardless of your credit or your background.
[00:05:01] When Brittany joined us, she was living in her car.
The first year she did four deals, made about 300 grand, using other people’s money.
[00:05:09] If it doesn’t work for you, we still give you $2000 back.
This is really a no-lose situation, as long as you try it.
[00:05:16] Bob: Wow, they really make it sound like you might’t lose.
So, how do you sign up, Dave wonders?
The answer, with your credit card, or maybe several credit cards.
[00:06:27] Bob: So what happens when the guests are invited to plunk down their credit cards?
[00:06:39] Bob: You saw 30 people go put their credit card in these machines?
[00:06:47] Bob: Wow.
[00:06:48] Dave Lieber: It works.
They give instructions on how to call the bank and get a higher credit limit.
Dave is astonished by what he sees.
I mean it’s a lot of people in the room.
[00:07:23] Bob: But Dave isn’t hypnotized.
He doesn’t plunk down his credit card or call asking for a higher limit.
Instead, Dave goes home and tells his editor about his lunchtime meeting.
[00:08:01] Bob: How long have you been doing that?
[00:08:03] Dave Lieber: Let’s see, I started the Watchdog Column in 2005.
The mail is just overwhelming.
[00:08:08] Bob: People are so desperate to have someone on their side, right?
[00:08:10] Dave Lieber: Well, they’ve exhausted all possibilities when they write to me.
They, they basically come to the end of the line.
So he tells his editor all about what happened in the ballroom.
So I left a message.
[00:09:18] Bob: This was a personalized video?
[00:09:28] Bob: Here is what that video sounds like.
[00:09:31] Hey, Dave, this is Tarek, this is my wife, Christina.
That’s what we do.
We’re in real estate.
[00:09:54] So maybe we’ll see you at a future event, Watchdog.
[00:09:57] Bob: Maybe we’ll see you at a future event.
Sounds friendly enough, but it doesn’t sound like they were taking Dave’s story too seriously.
But Dave sure did, and it’s a good thing.
[00:10:38] Bob: So Dave publishes his story, and the impact is far wider than Dallas.
It just spread all over the country really quickly within a day.
[00:11:00] Bob: It, it got picked up by other media outlets, right?
[00:11:02] Dave Lieber: Yeah.
A lot of women’s magazine websites picked it up.
You know, a half a million hits in like 24 hours.
[00:11:17] Bob: The story spreads across the internet.
People suddenly start questioning why HGTV lets its stars lend their fame and credibility to programs like this.
[00:11:50] Bob: The story has immediate impact on Dave’s readers too.
[00:12:05] Bob: That’s just really frustrating.
[00:12:19] Dave Lieber: Right.
[00:12:20] Bob: Often after some bad publicity, stories like this end right there.
A federal judge in Utah issues a temporary restraining order and then a preliminary injunction.
Their investigation alleges some pretty bad behavior.
But for all that money, all those consumers got almost nothing according to the agency.
We tried reaching out to Tarek and Christina too, but their agents did not respond.
They are still busy.
[00:15:54] Bob: Dave says most of these hotel ballroom programs follow the same pattern.
[00:15:58] Dave Lieber: I went to a women’s only conference.
And so I was like the only guy in the room.
So the first part of it is the lure.
And then the next part of it is the reward where they build towards the big pitch.
You’re going to, all your money problems are going to be going away.
I remember one guy said, you know, dreams come true.
It was like Disney.
And then, and then they give you the gift.
And I have a list here of some of the gifts.
I got a woman’s watch with a white band at that women’s only conference.
And then try and sell you an, an even bigger seminar to go to later on.
It’s like multi-steps, each one is more money than the previous one.
They usually come with high pressure tactics.
And that should make people pretty nervous.
[00:18:28] Hotel and free lunch meetings remind Steve of notorious timeshares sales tactics.
And then they get really angry if you don’t buy something at the end of it.
And it, you know, they can become very high pressure very quickly.
So the best way to avoid being subject to that high pressure stuff is just don’t go.
But it happens all the time.
[00:19:47] Bob: I love the metaphor of the magician and the magic trick.
And sometimes scam artists are, are like magicians in that way.
[00:20:12] Steve Baker: Yeah, they really are.
And I like to say, you just don’t know where to look.
You just don’t know where to look.
And they are masters of misdirection.
[00:20:28] Bob: And we want to believe, right?
We want to believe that there’s an easy way for us to make a lot of money.
[00:20:32] Steve Baker: Right.
Well a lot of scams are, are, are based on exactly that premise.
And they tell us things we want to believe.
It’ll be interesting.
I don’t have to buy anything.
And then they end up getting ripped off.
It’s often difficult for people.
So it sounds good.
Um, but there probably will be more house flipping scams, right?
You could just spend a few hours in a library reading.
Uh, that’s the problem.
[00:25:12] Bob: People buy lottery tickets every day, right?
[00:25:14] Dave Lieber: Right.
Well, it’s okay if you forgot that part, I did too, and Dave corrected me.
[00:25:43] Dave Lieber: You left out the gift.
[00:25:45] Bob: Oh, I’m sorry, I did leave out the free gift.
So it only had enough uh space for about 100 songs.
In today’s world, you know, that’s really no space at all.
It’s the cheapest, you know, made in China .mp3 recorder you could ever, ever imagine.
And that was the great gift that we were going to get if we stayed to the end.
[00:26:14] Bob: Do, do you still have yours?
[00:26:15] Dave Lieber: Yeah, I think I have it in a box somewhere.
[00:26:17] Bob: (chuckles) With the 10 songs on it that can fit.
It was, it was the cheapest, silliest little non-space .mp3 player that I’ve ever seen.
[00:26:34] Bob: That’s amazing.
Maybe you could fit one podcast episode on it.
[00:26:37] Dave Lieber: Yeah.
Which you could store The Perfect Scam on.
Call the AARP Fraud Watch web link Helpline at 877-908-3360.
Their trained fraud specialists can provide you with free support and guidance on what to do next.
Be sure to find us on Apple Podcasts, Spotify, or wherever you listen to podcasts.
For AARP’s The Perfect Scam, I’m Bob Sullivan.
