Work From Home Scams: How to Avoid and Identify Work From Home Scams & Find Real Remote Work
Work from home scams offer jobs that are too good to be true, often with dire consequences.
The novel coronavirus pandemic has caused many Americans to be out of work and struggling to find employment opportunities. Now more than ever work from home jobs seem like the perfect solution, allowing people to stay home while earning a paycheck.
Data compiled by FlexJobs shows that in early 2020, 4.7 million Americans worked from home on a full-time basis. That's an increase of 3.9 million jobs since 2015. Many employers prefer remote workers as it eliminates the expense of renting office space or running a brick and mortar location. Additionally, it allows employers and employees to work from anywhere. Many other individuals have developed home businesses or operate as "solopreneurs" or subcontractors for established companies. No matter what your industry the trend in remote work over the last few years offers freedom for the worker and eliminates the hassle of commuting.
- What Is a Work From Home Scam?
- Examples of Work at Home Scams
- How to Identify a Work From Home Scam
- How to Protect Yourself
- What to Do If You Get Scammed?
- Places to Find Real Work From Home and Remote Work Opportunities
- Stay Alert
A work from home scam offers a job that can be performed at home or from any remote location. Legitimate work from home opportunities exist; however, work from home scams outweigh the real possibilities of making a living from home.
The end goal of the scam is to take money from unsuspecting or desperate job seekers. Some scammers phish for information such as their victim’s social security number, bank account, or credit card numbers. Other variations of this scam are designed to coax the victim into signing up for subscription services that are impossible to cancel or paying large amounts of money up-front for low-quality or non-existent products.
Many scams fall into one of two categories:
- Manual labor and menial tasks. It's common to see jobs for stuffing envelopes or taking paid surveys. The pay is low or non-existent and often involves hiring other people.
- Start your own business. The "proven program" usually entails sending money for a start-up kit or certification. The information provided by the company is fraudulent, useless, or worse it ends up being a MLM (multi-level marketing) operation, which often end up being pyramid schemes.
Starting an internet business seems like an excellent way to earn a living. The ad for the job says no experience is necessary; the company has experts to coach new entrepreneurs. The company requires an upfront fee. Once the target pays the fee, the company adds other services and products necessary for success. The cycle continues, and the victim ends up with debt and useless information.
One common example of the above cycle is with dropshipping courses. You may have seen many “entrepreneurs” selling courses for dropshipping while scrolling Instagram or streaming Youtube. All of these so-called “expert dropshippers” are sitting in Lamborghinis in front of mansions stating that you can earn six figures within six months. Though there are legitimate dropshipping businesses, most of these are scams and the get-rich-quick mentality is only meant to lure in victims.
This con remains popular because it sounds easy to do. Anyone can stuff an envelope, right? The con involves getting people to pay upfront for materials and/or refusing to pay out unless the person hires others to do the same job.
Similar to envelope stuffing this scam promises good pay in exchange for assembling items or crafts. The company charges the victim for materials and then places an order. The worker spends many hours making the items, but the company refuses to pay for the products because they don’t meet the company’s standards.
A fake company offers money for processing rebates. The worker pays for materials, certification, and coaching. The only thing the victim receives is a fake training certificate and a manual filled with useless info.
Medical billing is a legitimate and profitable career – if it’s real. When it’s a scam ads will promise a lucrative income for processing medical claims with no experience necessary. The company sells the software and the training to create a successful medical billing business. The worker receives useless software, no training, and an outdated list of potential customers, many of which never requested the service.
Landing a job as a mystery shopper is simple. The worker shops or evaluates certain stores or restaurants for a small fee. While many of the jobs are legitimate, mystery shoppers never make a lot of money. Fraudulent mystery shopper companies will request their victims pay for fake certifications or directories.
Another common work from home scam involves multi-level marketing (MLM), which many times end up being pyramid schemes. Multi-level marketing involves selling products or services to other people while hiring others to do the same. The opportunities are often sold as a great way for you to be your own boss and enjoy work independence while making lucrative profits.
There are many long-standing, well-known MLM companies out there, like Amway and Avon, and some people may enjoy this type of employment. If you’re comfortable being a dedicated salesperson with a large network of people to sell to it could be a viable income source.
Multi-level marketing can work in many industries, but many companies will often make extravagant, unrealistic claims about what you will earn. If you’re thinking of joining a company that requires you to buy products to sell and recruit other salespeople it’s best to do your research and know the signs of a pyramid scheme.
Identifying a work from home scam isn’t always easy, but the following are red flags that a job may not be real or may even be illegal:
- The company asks for money upfront for materials, training, software, or other expenses. In exchange, the worker will make an unrealistic return on the investment. The FTC warns that if a job opportunity "promises of a big income working from home, especially when the 'opportunity' involves an up-front fee or giving your credit card information, should make you very suspicious."
- All communication takes place over email or instant message. Even if the hiree speaks to a person on the phone, it may be a scam. Scammers can spoof phone numbers from real businesses or use Voice over Internet Protocol (VoIP) to create untraceable phone numbers. The Better Business Bureau says a job offer without an interview is a red flag.
- The company uses a generic email account (Hotmail, Gmail, Yahoo, etc.), and the website seems poorly created or doesn't exist.
- The job offer is all fluff and gives no real information about the position or the company.
- The company emphasizes the importance of you finding other recruits from your network to do the same job as what you’re interested in.
- The company uses high pressure tactics and makes it seem like you’ll be losing out on an incredible opportunity if you don’t immediately take the job they’re offering.
Scammers buy and sell information, including identity theft, credit card, and bank account information, for many reasons. They are constantly looking for new ways to steal money from unsuspecting job searchers. Use the following tips to protect yourself:
- Take precautions when looking for a job on sites like Craigslist or any place jobs can be posted for free. Stick to professional sites like Indeed, LinkedIn, and ZipRecruiter.
- Ask questions. Ask about the job, getting as many specifics as possible. Get information on the company, including the main phone number and location.
- Use a reverse phone lookup app to research the number the interviewer calls you from. If you get a call from an unknown number, don't answer. If it's important, the caller will leave a message. Search the phone number to ensure it's legitimate before returning the call.
- Do not sign up on websites that ask for sensitive or personal information.
- Do your research. Read the Federal Trade Commission's Business Opportunity Rule, which states that a business must supply a disclosure document before you send any money. The rule includes making purchases or investments.
- If someone calls with a job offer and asks for any sensitive information, hang up and block the phone number.
- If a job offer sounds too good to be true, it probably is. Research the name and reputation of the company making the offer. Search the company on reputable sites like the Better Business Bureau.
- Discuss any job offer with friends and family. They may offer insights that could save you from being scammed.
- Keep security and other essential software updated and passwords strong to prevent cyberattacks.
- Use an identity theft protection service like Lifelock, Identity Force, ID Watchdog, or one recommended by your financial institution.
Con artists steal money and identity regularly and never get caught. In most cases, the money never gets recovered. If you suspect you’ve been a target or a victim of a work at home scam, report it immediately. Contact any bank or credit card company involved in the fraud. Change passwords, PINs, and any other identifiers. If the con artist steals your identity, contact a lawyer or other agency that specializes in identity theft.
Reporting fraud is a crucial step. If you receive an offer that seems suspicious or is a scam, you should report it immediately. Record as much information as possible before filing a report with law enforcement, the job posting site, BBB Scam Tracker, or the Federal Trade Commission. Note the day and time of the contact, phone number or email address, and the name and company information used by the scammer. Report the information by filing a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). You should also contact the Office of the Attorney General in your state.
Legitimate work from home jobs exist. Many resources list real jobs, but searching takes effort. Check out the following sites for real opportunities:
CareerOneStop, sponsored by the U.S. Department of Labor, lists thousands of jobs and includes links to programs in each state.
USAjobs.gov lists all open federal jobs, including responsibilities, location, and salary.
Flexjobs list work from home opportunities with legitimate companies worldwide. Users search listings by location, type of work, experience level, salary, etc.
If you’re interested in working for a particular company, go directly to their website. Many companies will have information about how to apply on their website.
Remote teaching continues to explode as a work from home job. Many digital nomads have given up corporate jobs to teach English online and travel the world. Some of these online English schools don’t require their teachers to have previous teaching experience, a 4-year degree is often sufficient. VIPKid, Magic Ears, and SayABC are some of the highest paying online English schools.
Another way to make money from online teaching is by leveraging your skills, maybe you’re an Excel wiz or a talented designer. On sites like Udemy and Lessons.com you can create a video course and get paid on a monthly basis for each student that takes your course.
Scams affect us all in one way or another. Some fraudsters target specific age groups while others cast a wide net to see who will take the bait. Victims of scams may not report being tricked, especially if money is involved. Education and awareness prevent scammers from committing theft, whether its theft of money, time, services, or identity.
Work from home and remote job opportunities can offer freedom, security, and peace of mind. Choose carefully and happy hunting.