by Nadia El-Yaouti | Jun 06, 2023
Photo Source: Dave Ramsey offers Bible-based financial advice on his radio show. (The Ramsey Show/YouTube via Yahoo)
Radio personality and financial guru Dave Ramsey has been hit with a $150 million class action lawsuit related to Ramsey's promotion of the now-failed timeshare exit company, Timeshare Exit Team. Ramsey, the CEO of Ramsey Solutions, rose to popularity because of his financial advice that pushes people to get out of debt and regain control of their finances so they can become “everyday millionaires.”
The lawsuit was brought forward by 17 former Dave Ramsey listeners and was filed in the U.S. District Court for the Western District of Washington in April. The lawsuit filing was reported last week by Religion News Service.
The lawsuit names Ramsey Solutions, Timeshare Exit Team, and Happy Hour Media Group as defendants and accuses them of violating the Washington Consumer Protection Act. The lawsuit explains that the defendants are guilty of unjust enrichment because they defrauded customers and committed negligent misrepresentation in the way they touted the services of Timeshare Exit Team.
Timeshare Exit Team was founded by Brandon Reed and a business partner in 2012 and is owned by Reed Hein Associates. The company built a narrative of being able to help timeshare owners successfully get out of their timeshare agreements quickly and more affordably than other competitors.
The company allegedly charged customers anywhere between $4,000 and $72,000 for “illusionary services” including the promise that customers could get a “100% refund if they were not relieved of their timeshare obligations.”
Ramsey, a stout opposer of timeshare ownership, encouraged his listeners who wanted to get rid of their timeshare to work with Timeshare Exit Team. Ramsey allegedly promoted the company as the only business in the industry that was able to successfully help timeshare owners get out of their contracts. However, the plaintiffs insist that Ramsey knowingly misled his listeners because he and other defendants were aware of the issues plaguing the company.
The lawsuit details, “Ramsey accepted payment from Reed Hein to make false statements to his listeners. Throughout his promotions, Ramsey assured his listeners that he had vetted Reed Hein and promised them that the company was the only trustworthy method to get out of their timeshare contracts. He called Reed Hein ‘legal specialists’ and claimed the company had a proprietary process to achieve its ‘exits.’”
The named plaintiffs explained that they followed Dave Ramsey’s advice and proceeded to pay thousands of dollars to work with Timeshare Exit Team. Instead of getting the services they sought, they were left with more debt when the company went out of business in 2012 after the company entered into a $2.6 million settlement to end claims of its “deceptive promises” to customers.
The lawsuit explains that over 10,000 people qualify for the class action lawsuit and were individuals "who, during the applicable statute of limitations, paid money to Reed Hein and Timeshare Exit Team for the purpose of obtaining an ‘exit’ from their timeshare obligations after being exposed to, and/or in reliance on, the statements and other representations made by Dave Ramsey, and The Lampo Group."
In his partnership with Timeshare Exit Team, Dave Ramsey made an alleged $30 million between 2015 and 2021 from the advertising services he provided the company.
The nationally syndicated radio host reaches millions of listeners during his radio show with an estimated 10 million podcast downloads each month. After partnering with the radio host, Timeshare Exit Team’s revenue skyrocketed from less than $1 million to $40 million during the time the company partnered with the radio host.
Despite reports that Timeshare Exit Team was unable to deliver on its promises, the lawsuit accuses Ramsey and other defendants of continuing their partnership with the now-bankrupt company. Notwithstanding client complaints, government agency probes, and multiple lawsuits, Ramsey allegedly continued to accept a reported $450,000 per month to promote the company. As a result, the plaintiffs detail that Ramsey and other defendants unjustly enrich themselves over what they should have known to be baseless claims.
The lawsuit is seeking damages in excess of $150 million along with other fees and damages. Ramsey Solutions, the radio host, and other defendants have not responded to the claims made in the lawsuit.
