Home Business Scams – Watch Out For The Usual Suspects

Like viruses, spam and telemarketers, home business scams have become increasingly prevalent in our lives. You often come across advertisements in the newspapers and on TV or in outdoor media touting the claims of easy home based business schemes. But beware, not all work-at-home opportunities deliver their promises. Often, the unsuspecting target ends up spending hundreds of dollars in return for nothing.

Educate yourself about the most common work-at-home scams and become an informed decision maker. Let us state that SOME companies in the following industries may be genuine, however, these tend to attract a lot of scamsters as well:

Envelope stuffing: The ads will typically say that for a “small” fee paid upfront, you will be able to earn money stuffing envelopes at home. But in reality, you will find that there is no real job to be done; instead you’ll receive instructions to place an ad just like the one you answered in newspapers or magazines, or to send it to friends and relatives. In essence, the only way you can make money is by getting more people fall for more of these home business scams.

Product/craft assembly: These schemes often require you to invest hundreds of dollars in equipment or supplies or spend many hours assembling a product. However, after you’ve purchased the supplies or equipment and performed the work, you might be in for a rude shock, and that is because you never get paid! You will be told that your work is not acceptable because it didn’t meet their “quality standards”. And you are left with relatively expensive equipment and supplies – and no income. You will have to find your own customers to sell these products to.

Medical billing: Competition in the medical billing market is fierce and revolves around a number of large and well-established firms. Almost all who buy into this opportunity fail to generate enough revenues to recover their investment, let alone make a profit. The ads will tell you that there are many doctors who process claims electronically and want to “outsource” or contract out their billing services to save money. Typically, in this type of work-at-home scam, you will be promised that you can earn a substantial income working full or part time, providing services such as billing, accounts receivable management and insurance claims processing. In reality, you will have to do all the selling and find clients on your own. You will usually find that the kit for which you paid hundreds of dollars, contains outdated or irrelevant physician contact information and useless software. These are one of the most expensive home business scams you could fall for.

Type-at-home: This work-at-home scam charges you a fee in return for a listing of companies looking for home-based typists. But the problem is that the listed companies are not even aware that they are on the list and very rarely do they need these services!

If you have ever been a victim of a work-at-home scam, you can file a complaint with the following organizations:

  • The Federal Trade Commission works to protect the consumer from fraud and deception. Call 1-877-FTC-HELP (1-877-382-4357) or log on to www.ftc.gov.
  • The Attorney General’s office in your state or the state where the company is located will be able to tell you whether you’re protected by any state law that may regulate work-at-home programs.
  • Your local consumer protection offices
  • Your local Better Business Bureau
  • Your local postmaster. The U.S. Postal Service investigates fraudulent mail practices
  • The advertising manager of the publication that ran the advertisement

While there are a lot of genuine home based businesses, the market is full of home business scams trying to trap an unsuspecting victims. Make sure you are not vulnerable, by taking adequate precautions before signing up for any opportunity.

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