Work at Home Scams

Know who you’re dealing with.
The company may not be offering to employ you directly, only to sell you training and materials and to find customers for your work.

Don’t believe that you can make big profits easily.
Operating a home-based business is just like any other business – it requires hard work, skill, good products or services, and time to make a profit.

Be cautious about emails offering work-at-home opportunities. Many unsolicited emails are fraudulent.

Get all the details before you pay.
A legitimate company will be happy to give you information about exactly what you will be doing and for whom.

Find out if there is really a market for your work.
Claims that there are customers for work such as medical billing and craft making may not be true. If the company says it has customers waiting, ask who they are and contact them to confirm. You can also ask likely customers in your area (such as doctors for medical billing services) if they actually employ people to do that work from home.
Get references for other people who are doing the work. Ask them if the company kept its promises.

Be aware of legal requirements.
To do some types of work, such as medical billing, you may need a license or certificate. Check with your state attorney general’s office. Ask your local zoning board if there are any restrictions on operating a business from your home. Some types of work cannot be done at home under federal law. Look for the nearest U.S. Department of Labor in the government listings of your phone book.

Know the refund policy.
If you have to buy equipment or supplies, ask whether and under what circumstances you can return them for a refund.

Beware of the old “envelope stuffing” scheme.
In this classic scam, instead of getting materials to send out on behalf of a company, you get instructions to place an ad like the one you saw, asking people to send you money for information about working at home. This is an illegal pyramid scheme because there is no real product or service being offered. You won’t get rich, and you could be prosecuted for fraud.
Be wary of offers to send you an “advance” on your “pay.” Some con artists use this ploy to build trust and get money from your bank. They send you a check for part of your first month’s “pay.” You deposit it, and the bank tells you the check has cleared because the normal time has passed to be notified that checks have bounced. Then the crook contacts you to say that you were mistakenly paid the wrong amount or that you need to return a portion of the payment for some other reason. After you send the money back, the check that you deposited finally bounces because it turned out to be an elaborate fake. Now the crooks have your payment, and you’re left owing your bank the amount that you withdrew.

Do your own research about work-at-home opportunities.
The “Work-At-Home Sourcebook” and other resources that may be available in your local library provide good advice and lists of legitimate companies that hire people to work for them at home. You may discover that these companies hire only local people and that there is nothing available in your area.

If you need advice about an Internet or telemarketing solicitation, or you want to report a possible scam, use the Online Reporting Form or call the NFIC hotline at 1-800-876-7060.

FTC Consumer Alert - Online Auctions

Online Auctions: Bidders Be Wary

Online payment and escrow services have become extremely popular in the Internet auction world - and for good reasons: Online payment services allow buyers to use a credit card or electronic bank transfer to pay sellers who may not be equipped to accept these kinds of transactions. Online escrow services accept and hold a buyer's payment until the merchandise is received and approved; then, they forward the payment to the seller.

But the Federal Trade Commission (FTC) is advising online buyers - and sellers - to be alert to phony online payment and escrow services. The consumer protection agency says that occasionally operators of these sites pose as sellers and buyers to improperly obtain money or goods.

How can you determine whether an online payment or escrow service is legitimate? The FTC offers these tips:

• Read the service's terms of agreement. If it's an online payment service, find out whether it offers buyers any recourse if sellers don't keep their end of the bargain, whether it prevents sellers from accessing their funds if buyers are not satisfied with the product, and who pays for credit card charge backs or transaction reversal requests.
• Examine the service's privacy policy and security measures. Never disclose financial or personal information unless you know why it's being collected, how it will be used, and how it will be safeguarded.
• Check out the online payment or escrow service's Web site. Sites that are of poor quality, say, with misspelled words, or that claim to be affiliated with the government are suspect.
• Call the customer service line. If there isn't one - or if you call and can't reach someone - don't use the service.
• Be suspicious of online escrow services that can't process their own transactions, but rather require users to set up accounts with online payment services.
• Check with the Better Business Bureau, state attorney general or consumer protection agency where you live and where the online payment or escrow service is based to see whether there are unresolved complaints against the service. Be aware that a lack of complaints doesn't necessarily mean that a service has no problems.
• Read Internet Auctions: A Guide for Buyers and Sellers.

The FTC works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint or to get free information on consumer issues, visit http://www.ftc.gov/ or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.