- New York, NY
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My Experience of Rich Dad/Elite Legacy Event Scam
I want to talk about my experience taking Rich Dad/Elite Legacy Education's three days Real Estate workshop. The conclusion: it's a scam. The purpose of this post is to alert people about this $35K scam (since BP has such a high Google ranking, and hopefully this post might come up in some's search result when they are doing research on this so called "Elite Legacy Education"), and here are the details:
I read the Rich Dad Poor Dad book back in high school, and I'm fascinated by his emphasis on financial education (although later on I realize man of his other books are repetitive and erroneous). So about a month ago, I came across a free rich dad ad on Instagram. Based on the graphic presentation of that ad, it shows Robert Kiyosaki, so I thought it would be great to attend this free event and meet him (similar meet the author events are very common here in NYC, so I didn't give it a second thought). I thought, learning any information is better than not learning at all, isn't it?
So I went the Hilton hotel where they held the conference/event. There were about 100 people attending. Much to my surprise, the author himself was not there--so I figured, they just borrowed the copyrighted trademark "rich dad." The first speaker talked about real estate; he started with a long introduction about how he become rich from a college student with debt by investing in real estate-- the theme of the story: education makes you broke, and you have to get a financial education. Since I always wanted to learn more about real estate and OMG, he was good at selling (plus they create an atmosphere of preying on people's fear of missing out). For the second part, another guy came out, and in the name of "multiple streams of income", he sold another three-day stock workshop course to me. Alright, I mean, after all, it's a free event, so I don't blame them for selling. Because I want to learn more about these subjects, I paid $299+ $199 to learn more about introductory to Real Estate and Stock Market. Fair I thought.
They gave me two bags, with some books and audios to read/listen to at home as my "homework" before the workshops. "Thoughtful!" I thought to myself and thought the workshops must be very intensive.
For me, the 3-day Real Estate Workshop was held at Roosevelt's Hotel.
I was given two booklets--
1) Real Estate Workbook (wich supplements the book they gave out before the workshop)
2) Real Estate Elite Workshop Events Catalog (which I first thought was the daily schedule for the workshop but later found out it's an information packet on the $39,500 "elite" courses that they sell)
The ironic part is that, through this three-day event, the so-called instructor Jason Jones referred to the Ad packet "Real Estate Elite Workshop Events Catalog" SIX times (he literally asked us to take it out and flip to certain page) and didn't mention ANYTHING nor asking us to read the "Real Estate Workbook ". What a great way to teach!
The instructor gave a case study where we needed to team up as groups of fours and figure out a way to buy an REO property with no money of our own and increase the equity by 30K. The resources we had:
- a bank (conventional) that lends money up to 35k for 650 credit score
- hard money lender with APR 120%
- seller/community (who acts like he doesn't want to talk at all)
- a real estate mentor that costs $35K to use
The "answer" to this exercise was:
Use personal credit to borrow from the bank and spend the $35k on mentor, and then mentor has the "connection" with the community bank to negotiate a deal and brought a 70K property for 40K with FMV of $140K. However, they didn't discuss how the student was able to raise another 40K (which I'm significantly concerned about lending 40K from a hard money lender and pay APR 20%).
They told us that they were giving out a bonus session for early comers. So people went there at 8:30 before the 9:00 start. And they end up talking about credit repairs.
But then, things turned VERY FISHY:
They asked people their credit score and asked us to fill out a "Strategy Session Checklist" that asked about the full legal name, occupation, annual income, bank account $, 401K, IRA, TSP, Available Credit on Cards, and Credit Score.
Instead of actually having a 1-1 personal financial coaching, they got your financial info and "taught" you to apply for a credit card and pay for their $39,500 program. And they said it's okay to "temporarily" have a bad credit score because you could also repair your credit. Ah! That's what the bonus session was for!
They asked a past student Andy to gave a talk on his success story after going through the program. What's annoying is the woman (one of the "expert" who played "mentor" role) kept on asking him rhetorical questions to prove the value of their program and act like it's the only way for one to succeed in the real estate market. But what I found ironic are:
- Andy, who has been working full time in RE for 4 years, are finally going to make $50K passive annual income from rental (with a flawed net profit calculation that didn't income vacancy rate, maintenance fee); and he said after attending the $39,500 program, he paid total $80K--poor Andy didn't even make his initial investment back after four years and yet they are demonstrating him as a success case.
- In fact, Andy is now a "trainer"--which seems to me, training is their stream of income, not real estate
- Andy revealed that he found his deal leads through words of mouth; what's ironic is the instructor kept on selling the importance of the company's Elite Success Software and told us we can't make deal without it
Instead of teaching something, they spent the whole third day (at least until 1 pm when I finally decided to leave) selling the program. When one student asked if the instructor is going to talk about a case study he promised to demonstrate, he responded (don't remember his exact word, but it's pretty much something like this:) :"If you are not even going to buy the next training, it's not relevant to you." And started to identify us as who will not make money and never succeed in life.
- I don't mind paying $40K for real estate education; however, my reservation is their professionalism. So far they only demonstrated their proficiency in the art of selling but nothing talented about their industry knowledge.
- They are extremely manipulative in their sales approach. Don't get me wrong; I don't hate sales people, being in Media industry myself, I understand that selling is necessary because at the end of the day everyone has bills to pay. But you need to be at least transparent and ethical in your practice. They are not calculating, but also very deceptive that now when I look back, the whole three days training is a step by step scripted the process of selling, every single second of it.
- I went to a top college and have a very stable career with great income. However, most people attending the event are less than college educated and have lower income. The fact that they don't have critical thinking skills and limited income/saving, makes them desperate and easy target. This is also my purpose for sharing the experience with the BP community and the internet community so that people are more informed. Seeing someone with bad credit, messed up financial, no job, putting the debt on his parent's account to pay for this program and hope to achieve a dream that he's most likely not achieve, really breaks my heart!