Identifying work-from-home scams can be tricky, especially as they often appear alongside legitimate opportunities on popular job-search websites. And if you’re a retiree looking to supplement your Social Security or a worker left reeling by the COVID-19 pandemic, it can be awfully tempting to follow those leads. Who wouldn’t like to earn big money stuffing envelopes or posting online ads from the comfort of your couch or get all the tools and training needed to start a lucrative home-based business?
Few of these offers ever lead to actual income. Instead, they’re liable to leave you with a lighter bank account or even heavily in debt.
Federal officials raised alarms about such scams spiking during the pandemic as millions of people who lost jobs searched for new employment. The Federal Trade Commission (FTC) received more than 104,000 consumer complaints about sham job and business opportunities in 2021, nearly three times the number reported in pre-COVID 2019.
The median loss in those cases was $1,991, among the highest for fraud categories tracked by the FTC. The Better Business Bureau (BBB) says employment frauds pose the second-highest scam risk for veterans and military families.
Typical ploys invite you to get to work stuffing envelopes, processing billing forms for medical offices, filling out online surveys, doing typing or data entry, or assembling crafts. The common thread is that you’ll be asked to pay something upfront for supplies, certifications, coaching or client leads — or sent a check to cover such expenses, which turns out to be bogus.
In return you may get a load of useless information, or nothing at all, or a demand that you place more ads to recruit more people into the scheme.
The BBB issued a warning in April 2022 about a new twist on this con, with supposed job recruiters offering targets an interview if they download a messaging app such as Telegram. After answering a few questions on the app, you get an offer, a contract, and a request for your personal data and banking information.
More involved cons promise to set you up in an online business — again, for a price, which can rapidly escalate into the thousands of dollars as one paid “training program” leads to another. One such operation, a Malaysian company called My Online Business Education, agreed in February 2020 to pay more than $17 million to settle claims that it defrauded thousands of would-be entrepreneurs with costly business-coaching programs before being busted by the FTC.
There are genuine work-from-home jobs out there. The trick is knowing how to spot the real opportunities in a sea of empty — and costly — promises.