written by: Finn Orfano•edited by: Brian Nelson•updated: 5/4/2009
Work-at-home scams require you to pay an up-front fee for nothing in return. This article will explain how to recognize and avoid them.
slide 1 of 1
Work-at-home scams are a kind of Advance Fee scam. They require you to pay an up-front fee or to purchase information before you seem to have the opportunity to earn money. Legitimate work-at-home companies don’t charge an up-front fee. They explain the job requirements, require prospective employees to submit a resume, and, when hired, the employee is added to their payroll and is required to complete required tax forms.
One scam trend is for the employee to receive their paycheck with additional monies included and a request to simply transfer what is not yours to another account. Unfortunately, many of these employees (victims) do not realize they are laundering money until law enforcement arrives. These overpayment scams can be quite cruel. In addition, the banking information provided when depositing their check in a bank account provides the scam artist with your signature and banking information. This opens the door for identity theft. These work-at-home scams search for victims (unsuspecting prospective employees) through email, online job postings, newspaper job advertisements, and any other legitimate tool that can attract prospective employees.
Sometimes your last contact with the company advertising is when you surrender the up-front fee. Sometimes the information you paid for is useless. Sometimes your money buys instructions to get whatever was advertised instead of the advertised product or service itself. Sometimes, when you have the opportunity to submit the products you assembled, you are told your work does not meet their standards and will not be compensated for your efforts.
Chain letters,envelope stuffingand medical billing-at-home are examples of work-at-home scams. The medical billing scam works like this. The initial advertisement and promotional literature claim that for a few hundred dollars they will provide you with everything you need to open your own home-based medical billing service including computer software and a client list in your local area. The reality is that the scamsters don’t help you register a business, the software (if you receive it) may or may not be compatible with your computer, the client list is irrelevant for your purposes, and the medical services companies in your area that are supposed to be needing billing services prefer to hire other companies not individuals to handle payroll and patient accounts.
Work-at-home scams are typically advertised through postal mail, spam email, fraudulent websites and illegal signs displayed in public locations. Don’t believe the advertisements that guarantee “big profits in the comfort of your own home for little effort."