With a tough economy and almost daily forecasts of additional layoffs, more Americans are looking for new ways to bring home the bacon—often, by working from home.
But it's scammers who usually get fat off their work-seeking victims.
"With the economy heading south and more people losing their jobs, we see an increase in people looking for work-at-home opportunities," says Alison Preszler-Southwick, spokesperson for the national Council of Better Business Bureaus. "As a result, scammers step in and take advantage of them."
The Internet has proved a great recruiting tool for work-at-home prospects, allowing scammers to hide their identities and post phony "testimonials" of now-rich employees. But even when newspaper ads or telephone calls are used to enlist would-be workers, most work-at-home scams involve the same ploys:
"Bait-and-switch" schemes requiring upfront payment for materials. Victims may pay an initial cost and then not receive the promised supplies, instructions or "client" leads, or they may receive some goods but then must shell out more for the "complete package." In either case, the money paid out far exceeds the true value of the promised materials, and "leads" may simply be names or companies taken from the phone directory. Classic examples of these scams include stuffing envelopes, assembling crafts, entering data and billing medical costs.
"Check-forwarding" scams in which victims receive a check for promised or completed work—only to be asked to wire a portion of it back to the scammer. The received check inevitably proves to be counterfeit, and banks hold victims responsible; victims may also face check fraud charges. Scammers usually operate from online job sites, where they advertise for U.S. agents for phony overseas companies. A variation is the "reshipping" scam, in which victims receive merchandise at their homes to be reshipped overseas. But the goods are often purchased with stolen credit cards, leaving the reshipper subject to criminal charges for receiving and transporting stolen goods.
New ploys that have recently emerged include:
Mentoring programs. "[Scammers] place advertisements in local newspapers to 'Start Your Own Business,' offering a $69 startup kit in any of about a dozen different opportunities," notes Kevin Farrell of the Lee County Sheriff's Office in southwest Florida. "But once that money is sent, the kit says you need to pay $650 more to have a mentor give you personal instructions over the telephone." Farrell notes that in his area, with its large retiree population, such work-at-home scams seem to target older people.
Rebate processing. In this ruse, says Preszler-Southwick, victims answer job ads, thinking they will process rebate forms for leading companies. "In reality, these jobs instead involve placing advertisements on the Internet and selling products. Victims pay upfront fees and are promised their money back if not satisfied. What we're seeing is they don't get their money back."
The bottom line: Be suspicious of any job opportunity that requires any upfront fees or pays you with checks that require a Western Union or other wire transfer. According to an October 2007 report by the Federal Trade Commission, about 2.5 million Americans—nearly 1 percent of the entire population—fall for work-at-home scams each year, and many are repeat victims. With today's bad economy, there's no indication that's about to change.