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How To Spot Work From Home Scams: 12 Common Work From Home Scams

Updated on April 5, 2018

With so many outlets of technology and social media at our fingertips, the idea of working from home is gaining in popularity. This is especially true for those of us that are stay at home parents looking to earn some residual income in these trying economical times. The problem is that with its popularity, the shady scamming companies are crawling out of the network and taking advantage of those of us interesting in working from home. Hopefully I can shed some light on avoiding being scammed, is to know how to spot a potential scam to begin with.

The trick to working from home is knowing the differences in a scam or a legitimate opportunity to work from the comfort of your home office, or couch! The best defense is knowledge. Knowing what to look for and what to ask can save you from falling victim to identity theft, losing your ‘investment’ and much more.

Working From Home

Working from the couch is so comfortable! Be aware of the large number of scams just waiting for people that want to work from home!
Working from the couch is so comfortable! Be aware of the large number of scams just waiting for people that want to work from home!

Work From Home Ads

I am sure everyone has seen at least one "Work from home" ad on a web-page, classified ad, a bulletin board or during a web search. They promise things like "Make $1,000.00 a month", or "Flexible work schedule", even the enticing, "Be your own boss". Just because it is on the internet, or even a paid advertisement does not make it a legitimate home-based business or work opportunity.

Unfortunately, we do not live in a perfect world free from scams and identity theft, so always research any company before jumping into a position with them. Even if you will be a private contractor, or freelance employee. I am totally against paying to work from home as well, unless you are venturing into direct sales and you are paying for a "kit" to help you demo items to clients or prospective customers. A company should never ask you to "pay" to work for them, the concept is ludicrous, you want to work to get paid.

Focus on researching these companies, you should always look for a scam report on any work from home opportunity or website. You can do this by simply typing "scam report and inserting the name of the company" into your browser. This is also true for any direct sales websites, I learned this the hard way in the past.

11 Ways To Spot a Work From Home Scam

Money is tight, and you keep seeing work from home opportunities. But Before you jump in to any of these, you need to be able to spot the scams. To simplify I will list them and then discuss them in more detail.

Work at home scams to avoid:

  1. Envelope stuffing
  2. Assembling products or crafts at home
  3. Processing rebates
  4. Online searching
  5. Medical billing and processing
  6. Anything requiring you to enter credit cards
  7. Paying for hire - anything with high startup costs
  8. Package Forwarding
  9. Email Forwarding
  10. Incoming jobs (emails telling you that a job offer is being extended)
  11. Data Entry (some are legit, others are scams)

Here are the Immediate signals of a scam:

  • Sounds too good to be true! Guess what - it probably is!
  • If it is an overseas company
  • Flimsy or vague payment instructions or structures
  • Large Up front financial investments

It is best to avoid any of the things listed above, I will discuss these in more detail, so you understand why you should air with caution on any of the work from home job types listed above.

Have you ever looked into any of the scams I listed above?

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Envelope Stuffing/Sending Mailers

I am amazed that with email and social media that this one is even a functioning scam these days, but people still fall victim to it. How often do you get any unsolicited mail, other than maybe coupons or from department stores? I mean really, what reputable company is sending direct mailings these days, by employing a third part to do the mailing?

For this article, I searched and found an envelope stuffing, work from home job opportunity and requested information. After getting the introduction package in the mail it did not take me long to see how this was a scam. They wanted me to pay for all supplies and postage, and then they would reimburse me. There was also the $36.00 up front cost (no thank you), just so I could start stuffing envelopes and shelling out my own money to cover supplies and postage.

Of course, I did not accept the invite! Looking deeper into these types of work from home scams once you pay the fee you find there was either never any work to be done or it is a chain scam. A chain scam is after sending in your initial payment, you will get a packet to refer other people, friends and family to the same opportunity or to purchase a product. So, while you are "stuffing envelopes" you will make no income unless others bite on the scam too.

The letter that was sent by this envelop stuffing company was also full of a List of other "work from home jobs" that I was qualified for, and all I had to do was check a box by what I was interested in for more info! Imagine how many people fall for that, so save your startup fee and move on.

Inbound jobs

Have you ever gotten an email from an unknown source offering you a job?

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Product Assembly and Craft Creations

It is amazing that this type of scam has been around for decades and countless people still fall for them every year! These are ads you see for sewing aprons, baby items, assembling dollhouse furniture or photo frames and a slew of other items.

While these seem like the dream job and offer to pay large amounts per unit, or per piece depending on what you will be assembling or making. What they fail to disclose is they often require hundreds if not thousands of dollars in investing in specific equipment to complete the items to their specifications. Not to mention, that you often must put a deposit on the material needed to build these items. If you do fall for this still thinking that it is worth the investment, you will most likely never get paid. Once you submit your items the company will then refuse payment because you work is considering to be "flawed", "substandard" or not to the specific specifications they expected.

Now you are left with nothing, but the equipment and materials and you are out of pocket for both! Save yourself the investment, if this is of interest consider doing it yourself and selling your creations on Esty, eBay or Amazon Handmade!


Rebate Processing

Often you will find this scam in an email. With Promises of great pay for you to process rebates, all while in the comfort of your home, (I have also seen processing tax returns too). Again, these companies are banking on hooking you without disclosing much if any information about the job.

These companies will often require you to have training and certification to offer you work, of course it is no surprise that they offer this training and certification for a nominal fee! Usually "connecting" you with a mentor who has succeeded for many years with the company. Often this mentor is the one scamming you, or in some cases it is a bot running the scam. You end up with useless training materials, and certificates, never even receiving a single rebate or return to process.

Your better bet is to work for a tax firm hiring temp employees during tax season. Go direct to the source and many do offer the training in an online setting to make it easier to have you fully trained when tax season rolls around/ It will not be work at home, but its additional income often offering a flexible schedule.

Get Paid to Search Online

This is a tricky one as we all know offers rewards for searching with their browser. The difference is they are not offering you a JOB! These work from home jobs, promise anywhere from $100.00-$7,000.00 a month in earning potential for simply running searches on prominent search engines that they are affiliated with and filling out short reports or questionnaires. Sadly, they have no intention of paying you, they are trying to hook you in with false promises. All in the hopes of stealing your credit or debit card information and even stored passwords in hopes to gain access into your financials. While there are a few and I stress very few paid for searching work from home jobs, they differ greatly to the scams.

Medical Billing and Processing

This one is often seen as a legit job, since many companies do offer this type of at home job, though it is general something one needs to attend at least a legitimate certificate, or degree program for. Or physical training in an office setting at the very least.

An actual interview will often be done for these scams, making it easier to fool the job seeker. The difference is a real company generally only allows you to do this after a minimum of a year in one of their office environments pending an evaluation, for approval to telecommute. Therefore, so many people fall prey to the promises of full and part time employment with these types of scams.

Once you are contacted, you will be instructed that you need special software to process the required billing statements or the data entry. Though they will gladly be providing it, for a fee of course. Big shocker here - they are the only company you can purchase it from. Costing the job seeker thousands of dollars, yes thousands! As well as having to pay for a client list along with technical support, if this type of work from home job interest you, get certification and find a reputable company to work for.

Package Forwarding

This work from home scam can land you in hot water, with potential legal action against you! This scam is rooted around identity theft, an identity thief steals an identity and uses it to purchase products with a victim’s credit or debit card. Knowing that the thief does not want it sent straight to his or her door (knowing this will inevitably lead the police to the door as well), they will create fake ads online, Craigslist, forums anywhere they can.

These ads will Ask for help in forwarding packages due to an overstocked business or under the guise of traveling themselves, or even helping someone who is traveling. As a rule, overstocked businesses usually have flash sales to reduce stock. If you are traveling you can have your mail forwarded! Once you receive the stolen goods and forward the package or packages (out of your own pocket) you will wait on repayment and compensation check that most likely never comes. Very rarely they pay, inevitably the police will come knocking wanting to know why stolen goods were delivered to your house, try disproving that one!

Email Forwarding

Remember me saying that people will still falling for envelope stuffing? Well this is the "new age tech" form of envelop stuffing if you will. You see an ad or get an email asking if you would be interested in forward emails to a company’s client list in exchange for great pay. The companies growing needs and customer base requiring them to outsource some employment. It may even look like an entry level position in social media marketing, and usually you are informed that to get started they need a fee to send you the materials.

These may be training materials, customer contact information, specific programs for your computer etc. Once they have your hard-earned money you will likely receive nothing, in some cases they are gracious enough to send you complete instructions on how to pull the same scam on others!

Incoming Job Offers

Your email can be your worst enemy, unless you get an email from a reputable place like LinkedIn or Monster with interest in your resume, you should swiftly file it under spam. Think about it how did they find you to begin with? Generally, you will follow a link in the email and are prompted to enter your personal information, full name, address and so on to see if you qualify for the job. Of course, they are down to only two or three available positions left and you need to hurry to secure your spot.

To secure your spot, you need training and/or materials, guess what, they will gladly train you if you pay for it! Often costing the unwitting job seeker $200.00 or more! The job is scheduled to start after you complete your training. Guess what, you paid $200.00 and gave them your credit card information, and the training never happens the job never starts! This has potentiality caused theft of your identity and credit card fraud that will cause your ongoing issues for a long time.

Identifying Work From Home Job Scams Quickly

It is always possible that some entity will pull the wool over your eyes and scam you out of your hard-earned money! Knowing what to look for will help you from investing too much time and possibly save your money from these thieves! So, lets break it down to what you should consider "Red Flags" and opt to ignore altogether!

  • Upfront costs - No legitimate company will ever bill their employees upfront as a condition of employment! Any needed software or equipment is considered and factored into the company’s budget for training employees. You would not pay Target to give you a job, right? Use this logic and decline any offer that wants any money from you. Other than direct sales where you pay for a kit to demo, those are perfectly acceptable because you at least have something in exchange for your money!

  • Testimonials, scanned checks - A reputable company will not post employee testimonials and show scanned checks for proof of payouts! They will tell you about the company and what they expect from you as an employee should you choose to work with them. Steer clear of anything that is a page full of "happy" employees talking about the 5 vacations they were able to go on etc. Should be common sense, yet a lot of people get caught up in the excitement and possibility.
  • Advertising - You should be looking for product or service ads from any company you are considering working for. If all the ads seem to focus on employment, then odds are it is a scam. A reputable company knows that the customer base is how they pay their bills. Focusing solely on ads for job opportunity means odds are they are getting their money from the employees and not a service or product they offer. Steer clear if you cannot find an ad for the services!

  • Website - Does their website tell you where or how they are making money? Most companies give you a great bio of the product or service they provide and how long they have been in business. If you do not find this on a company looking to hire, stay away!

  • Complaints -. Check with the BBB (Better Business Bureau) and your states Attorneys General office. This is where people file complaints about products, services, scams and fraud. You will also know how long they have been in business and if they are being investigated. This should not be your decision maker, they can still be ripping people off and have not had a complaint yet! Or doing it in such a way that it is deemed legal.

  • Who can do the job - Can the job be done by anyone, or by no one? Why are they hiring people to do that? Odds are you could end up being an unknowing participant in money laundering, trafficking, identity theft or a slew of other illegal schemes. If it seems too good to be true that they are offering to pay someone for something anyone can do, it probably is. You may even end up with a paycheck, but it is not worth having a SWAT team kicking in your door!

Always keep in mind how and who will be paying you, and when you will get the first paycheck, what do you get for your investment. I still say the only investment you should ever have to pay for is with direct sales like Avon, Pampered Chef and Jewelry in a candle (there are way too many to list). Even with direct sales you can be ripped off, always do your research on these companies as well.

What did you learn?

Do you think you will fall victim to a work at home scam after reading this article

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I suggest keeping a journal of the ones that you research and find to be scams. Use it as a quick reference tool when you search again.
I suggest keeping a journal of the ones that you research and find to be scams. Use it as a quick reference tool when you search again.

Finding Real Work From Home Opportunities

I have compiled a list of top 5 work from home jobs, covering some legitimate ways to earn money from the comfort of your home. So if you are still interested in working from home, I have done the research and found 5 legitimate ways to earn money from the comfort of your couch!

© 2015 Cynthia Hoover


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