Avoiding Online Work-at-Home Scams
Top 7 Internet Frauds and How to Safeguard Yourself Against Them
Jun 18, 2009
The Internet offers many work-from-home opportunities that indeed result in big profits, but not every offer out there is legitimate. There are seven popular types of Internet scams that everyone needs to be aware of when investigating how to make money online.
Home Jewelry or Craft Assembly Scams
In this model, people buy a starter kit with all the parts they will need to assemble pieces of jewelry or craft items. They are promised compensation for their work when the finished items are returned to the company. But as "luck" would have it, the items are always rejected with the explanation that they failed to meet quality control's standards. The scammer earns his or her profit from selling starter kits, not the finished product.
Medical Billing and Medical Transcription Scams
This scheme is similar to home assembly scams in that the online scam artist makes money from selling start up materials. The job itself is completely bogus. After paying up to $1,000 for training materials and supplies, the person finds that the company suddenly vanishes. Legitimate medical billing and transcription work is almost always given to companies, not individual freelancers.
Freelance Writing Scams
Anyone can use Google AdSense to generate revenue on a website, but they need content for their pages. Online scam artists try to get free content from unsuspecting freelance writers looking for work. There are many legitimate freelance writing jobs, but scam artists are often vague about payment or require writers to submit several original "sample" articles as part of the screening process before are hired. After getting as much written material as they can, the scam artists disappear and the writer never sees a dime.
Envelope Stuffing Scams
Envelope stuffing is one incantation of the classic pyramid scheme. A typical envelope stuffing ad promises big profits mailing envelopes, and interested individuals just need to send in a few dollars and a self-addressed stamped envelope to receive more information. What they end up getting is a bunch of envelope-stuffing ads, which they are supposed to send to interested people requesting information about the non-existent "opportunity."
Email Processing Scams
Email processing is a modern twist on envelope stuffing schemes. Ads promise the ability to make between $5 and $50 per email processed, with a chance to earn unlimited profits. The emails are really spam, and if the processor is ever paid it is only when someone buys whatever the spam ad is selling. In addition, some variations of email processing schemes require a sign-up fee to become a processor in the first place.
Multi-Level Marketing Scams
Multi level marketing (MLM) is technically a legitimate business setup, but it's such close cousins with the pyramid scheme that the line is often hard to distinguish. MLM businesses pay on commission from a person's sales and the sales of those they refer; they become scams when people are given commissions for each referral and sign up. The act of referring others becomes much more important than selling an actual product. Multi level marketing scams are often called "network marketing" or "martrix marketing."
Cash Gifting Scams
Cash gifting is one of the newest incarnations of the pyramid or Ponzi scheme. Scam artists figured that selling nonexistent products can get them in trouble, so why not forget about the product entirely and just send cash in the mail? This way, they hope to avoid legal issues. However, cash gifting is a fairly transparent pyramid scheme, where the only way to get paid is to scam others out of their money.
Tips for Avoiding Online Scams
Scam artists really only have a few tricks in their bag and dress them up in new ways to re-use again and again. To help recognize them and prevent being victimized by an Internet scam:
- Research the company's reputation with the Better Business Bureau and Google the company name to find independent reviews.
- Be wary of any up-front investment or membership fee.
- Never pay for a product when it is unclear what you are actually buying.
- Ask detailed questions about how and when you will be paid, and by whom.
- Don't respond to fishy-sounding emails containing strange punctuation symbols, poor grammar, or incoherent or unprofessional language.
- Do not reply to unsolicited emails advertising business opportunities.
- Be cautious of any home-based business offers that promise profits with no experience necessary, or that promise overnight profits with little or no effort.
- Think critically about whether there would be a legitimate reason for someone to recruit an employee for the job as advertised.
Detecting work-at-home scams can be difficult because scammers can be so clever and convincing. Plus, people often want to believe promises that are simply too good to be true. But remember to exercise caution before signing up with any home-based or money-making opportunity, especially over the Internet.
For specific online money-making methods that have been personally tested by the author, read "Making Money Online with Mechanical Turk" and "Top 10 Paid Survey Sites."
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