Did They Get Rich Quickly? Not Really

Critic Reed challenges the deals on his Web site, claiming, among other things, that "the documents seem to show that Allen lied to" one lender about whether there was any secondary financing and about his intention to live in the property as his principal residence. Reed also writes at length about Allen's Chapter 7 bankruptcy filing in 1996, and questions how a successful investor could end in a bankruptcy where "his creditors got nothing."

Allen spokesman Kilsheimer said Allen has acknowledged the bankruptcy, but blames it on his house being destroyed in the early 1990s by an avalanche. Kilsheimer said the loss of the house also led to a series of federal and state tax liens that Allen told him have been satisfied.

While Kilsheimer said he could not specifically respond to Reed's claim about the documents in the original 1981 challenge, he said, "My take on [Reed's] motivation generally is that he has his own real estate advice to sell, which is a great reason to slam other people."

Gaithersburg resident Bahjat doubts that any of the workshop participants he met a year ago could have done what Allen says he did in San Francisco.

"Maybe a year later, after they've studied the materials, the people who attended my workshop might have a chance" to buy a property with no cash and no credit, Bahjat said. "But if you'd dropped any of those students there [right after the class], they'd be begging on the streets."

Bahjat and others warned that those considering paying for classes need to be cautious: Real estate novices, they said, could get lost quickly in the rapid-fire presentation.

Another issue that came up in an interview with a student who signed up for the Allen training camp last year concerns refunds.

Eleanor Keliher, an Annapolis resident who sought a refund last February, said she made repeated calls, but that she did get her money back within 30 days.

Allen spokesman Kilsheimer said, "The company has people in the office whose job is doing nothing else but paying refunds." Allen said the company makes clear it has a 30-day money-back guarantee.

Bob Steere, a consultant who attended last year's Cash-Flow Generator Workshop, said he had had "a devil of a time" getting his $1,200 back from that class and only received it a month ago.

Whitney spokesman Whitaker said he knows of no complaints about refunds, but noted that the company inherited Steere's complaint after buying Success Development.

The Better Business Bureau in Washington this week said the Success Development affiliate, SDI Wealth Institute Inc., had an unsatisfactory record in Jacksonville, where it was incorporated, because of "a pattern of unresolved complaints, and failure to eliminate the basic cause of customer complaints."

The Whitney Leadership Group also has an unsatisfactory record with the Better Business Bureau of West Florida, with 116 complaints in the most recent 36-month reporting period. Whitney's group "has met with Better Business Bureau staff and has taken action to resolve previously unanswered complaints. Additionally, more recent complaints are being responded to in a timely manner," the current Better Business Bureau report says.

Others said they found the Allen program useful.

"For me personally, I don't think it was a waste of my time," said Kevin Dworak, 33, a Washington architect-designer. The class helped give him the confidence to take equity out of a condo that had tripled in value, he said. He used the money to buy a house in Silver Spring recently.

Dworak said he did not use any of the no-cash-down techniques recommended in the course and that he had good credit and assets. He also used a real estate agent to buy the Silver Spring fixer-upper.

"But I wouldn't have known a lot of questions to ask my Realtor" without the class, he said.

"My personal interest in the class was very pointed," he said. "I was interested in buying houses, fixing them and selling them. . . . And there was certainly something to be gained. But some people might have been suckered in and ripped off. . . . Without a doubt you would have to put some effort into doing it."

Donna Hartsoe, 42, a Fredericksburg resident who recently started her own construction company, also said she thinks her money was well spent. "I thought it was good," she said. "It's hard to describe what you get out of something like that, how it can expand your horizons. . . . But I feel like it just pumped me up, which is good when you have so much negativity around."

Hartsoe said she had bought and sold "a couple houses, but not necessarily with their stuff." Her career, she said, was spurred most by the investments she had made while working in the information technology industry. "In general I was going to do this kind of thing anyway," she said.