Financial False Prophet Dave Ramsey Faces $150 Million Lawsuit After Listeners Claim They Were Defrauded In Timeshare Exit Company He Promoted

The following report is by Religion News Services with partial editions by Jacob M. Thompson:

A group of former followers of Dave Ramsey has sued the Christian finance guru and radio host, along with his company and a marketing firm, for endorsing a failed timeshare exit company that allegedly defrauded customers out of millions.

Seventeen former Ramsey listeners filed a class-action lawsuit in the U.S. District Court for Western Washington alleging Ramsey was paid as much as $30 million from 2015 to 2021 to endorse Timeshare Exit Team, a Kirkland, Washington-based firm that collected $200 million from clients — many of them Ramsey listeners — in exchange for a promise to free them from their timeshare obligations.

That promise came with a money-back guarantee.

But the company, which often collected more than $5,000 per customer, failed to live up to its promises. In 2021, Reed Hein & Associates LLC, which did business as Timeshare Exit Team, paid $2.61 million to settle a deceptive business practices lawsuit filed by the attorney general of Washington state and later went out of business.

The lawsuit alleges that Ramsey, Timeshare Exit Team and Happy Hour Media Group, a marketing firm with ties to Brandon Reed, one of the founders of Timeshare Exit Team, violated the Washington Consumer Protection Act by defrauding customers, committed “negligent malpresentation” and were guilty of “unjust enrichment” and conspiracy.

The lawsuit seeks damages in excess of $150 million.

Plaintiffs allege they relied on Ramsey’s enthusiastic support for Timeshare Exit Team and his expertise in finance when they decided to do business with the company.

Known for his hatred of timeshare companies, Ramsey had boasted about his confidence in the expertise of the Timeshare Exit Team. In a 2018 segment of his show, a video of which remains on the YouTube page of “The Ramsey Show,” Ramsey told listeners he had looked for years to find a company that could help people get out of timeshares.

I never could find anything until I found this company called Timeshare Exit Team. About three years ago, we started endorsing them and I’ve had so much fun pissing off the timeshare people.

He said in the segment, which touted the company’s money-back guarantee.

AUTHOR’S NOTE: Additionally, on May 27th, 2020, Ramsey and his team published a long half-hour clip of him answering calls sharing their timeshare scam stories. Immediately Ramsey states in the beginning of the video: “We are proud to endorse Timeshare Exit Team, […] and so for Timeshare Exit Team to come along and find a way to get them out of their ripoff timeshares, I was so excited to endorse them and I still remain proud to endorse them.”

Ramsey then addressed a tweet by Mike Flaskey, the CEO of Diamond Resorts, one of these top shrewd timeshare companies, ripping on Ramsey for being endorsed by Timeshare Exit Team for making millions in sponsorships while the company was being sued for millions by the Washington State AG, among others. Ramsey retorted that Flaskey was getting his “butt-kicked up around his neck and he’s wearing it like a collar.” Dave affirmed that he was making millions from the endorsement and was “proud of it,” but added that he “does not endorse things that we do not believe in.”

As previously reported by Religion News Service, Ramsey stuck by the company, despite its legal troubles and allegations it had defrauded customers — claiming government officials, reporters and the timeshare industry had conspired against them.

Instead of acknowledging the deception, Ramsey recorded a nine-minute radio segment in which he lashed out at anyone he felt to be responsible for Reed Hein’s woes.

The complaint alleges.

The complaint also details the tactics allegedly used by Reed Hein to defraud Ramsey’s listeners. After signing contracts with customers, the company would allegedly tell them to stop paying their timeshare fees and created fake property deeds aimed at convincing those customers they were free of their timeshares.

When customers finally discovered the schemes and demanded their refunds, Reed Hein fabricated excuses not to honor the promises or stopped returning their calls.

The complaint alleges.

The plaintiffs in the lawsuit argue that Ramsey should have known better than to endorse Timeshare Exit Team. The complaint alleges the Lampo Group he runs, which does business as Ramsey Solutions, began receiving complaints about Timeshare Exit Team as early as 2016 and continued to endorse the company even after the Better Business Bureau warned consumers about Timeshare Exit Team and courts found the company had acted in a fraudulent manner.

Ramsey has gained the trust of millions of followers through his long-running radio show, conferences and “Financial Peace University,” a faith-based personal finance program taught in churches around the country. His expertise, the complaint alleges, should have made him aware that Timeshare Exit Team was not to be trusted.

However, Reed Hein made many claims that any competent financial advisor with Dave Ramsey’s knowledge and skill would know to be false, and it engaged in many activities Dave Ramsey would have known to be illegal.

According to the complaint.

The lawsuit also names Happy Hour Media Group, which the complaint alleges helped promote Timeshare Exit Team. Happy Hour was co-founded by Brandon Reed, who also co-founded Timeshare Exit Team. According to Washington state’s attorney general, Reed had been a rain gutter salesman when he founded Timeshare Exit Team and started the company after seeing a long line at another timeshare exit company’s booth at a trade show. He had no legal expertise or experience getting people out of timeshares.

The company’s sales exploded after it began to advertise on Ramsey’s radio show, according to the complaint. The company stopped advertising on Ramsey’s show in 2021, which Ramsey blamed on the cost of fighting “a massive set of lawsuits” against it.

Happy Hour did not immediately reply to a request for comment. Neither did Ramsey Solutions.

Among the plaintiffs named in the complaint is Greg Larson, a longtime Ramsey listener and shipyard worker who allegedly heard Ramsey’s endorsement of Timeshare Exit Team “hundreds of times” before contacting the company. Other plaintiffs include health care workers, retirees and others who had become Ramsey followers through their churches or the radio show.

The complaint details the relationship between Ramsey and Timeshare Exit Team, one of the “endorsed local providers” who rely on Ramsey for business leads. Ramsey Solutions would collect those leads through its church-based programs, the company’s website and newsletters.

Ramsey’s followers were not aware he or his company were paid for their endorsements or for referrals, according to the complaint. It was a profitable enterprise for both parties, according to the complaint.

During the period Dave Ramsey was promoting Reed Hein’s scheme, customers referred to Reed Hein by Defendants paid Reed Hein in excess of $70 million in fees for timeshare ‘exit.’ Ramsey never returned any of the tens of millions of dollars Reed Hein and Happy Hour Media Group paid him from his own listeners’ hard-earned money.

Instead, Ramsey has chosen to profit from his listeners’ money.

According to the complaint.

For his part, Ramsey defended Timeshare Exit Team in public while distancing himself from the company behind the scenes. The Christian finance guru was subpoenaed by Washington state’s attorney general in its lawsuit against Timeshare Exit Team. His lawyers objected, saying he was too busy to be deposed and he was not responsible for the endorsement.

While he has promoted Lampo’s endorsement of Reed Hein on his radio program and on social media, he is not responsible for the details of the Reed Hein relationship.

His attorneys wrote.

The class-action lawsuit is the latest legal woe for Ramsey and his company. Several former employees have sued the company for discrimination, including one who was fired after telling her boss she was pregnant and another who claimed the company had a “cultlike” environment.”

Though a private company, Ramsey Solutions is run like a church; employees are expected to maintain a “godly” lifestyle and attend regular worship services at work. The company was once named one of the best places to work in the country, but its reputation has taken a hit in recent years due to Ramsey’s outspoken objection to COVID-19 restrictions and the company’s “no-gossip” policy, which has often resulted in employees who complain being fired and fostered a culture where employees are encouraged to report on each other for rules violations.

Despite his legal troubles, Ramsey has remained defiant. His approach is perhaps best summed up in his 2021 defense of Timeshare Exit Team, even though the company was dropped as an advertiser. 

Bring it. You have done poked the wrong bear. You done pissed off the wrong hillbilly.

Ramsey said

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AUTHOR COMMENTARY

Whoso boasteth himself of a false gift is like clouds and wind without rain.

Proverbs 25:14

We’ll have to wait and see what comes of this, but this sounds par for the course for Ramsey. Ramsey is not a capitalist: he is a mammon-worshipping huckster who will sell you a sticky gun with spent shells, and then belligerently attacks anyone for calling him out, and uses his deep pockets to quell any dissent. Ramsey preys on the ignorant and innocent.

This is the same reason why he and his team keeps telling everyone to buy a house, no matter how bad the environment is, because he’s sponsored by companies that sell home insurance and other real estate firms; on top of other financial companies he flaunts. There is nothing wrong with sponsorships, but not when you compromise integrity, morals, and sound reasoning for profit.

Thy princes are rebellious, and companions of thieves: every one loveth gifts, and followeth after rewards: they judge not the fatherless, neither doth the cause of the widow come unto them.

Isaiah 1:23

SEE: Evangelical Financial Advisor Dave Ramsey Says There Is No Market Bubble

Charlatan Dave Ramsey Says The Banks Are Safe And You Need To Buy A House Now

Ramsey has good advice on how to get out of debt but that’s about it. He is the Jim Cramer of investing, and his practices will send you into debt overtime if not careful, though he’ll gladly sell you his latest book and course on how to be financially free.

You’d be wise to avoid him.

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[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).

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