Most Fall into Five Categories: Upfront Payment Scams, Money Laundering, Reshipping, Man-in-the-Middle Scams, and Pyramid Schemes
Mothers with small children, retirees, the physically challenged, students, people looking for a second job they can do from home in the evenings. These and others like them are the preferred targets for work-from-home scams.
Typically, work-from-home scammers initiate contact with their intended victims by email, although there are at least 300 around the world who even maintain their own websites. Most of these scams generally fall into one of five categories:
- Upfront payments
- Money laundering
- Man-in-the-middle scams
- Pyramid schemes
Advance Fee Scams
Upfront payment scams promise employment to jobseekers in exchange for a commodity that is required for the position. The victim then pays for the commodity and one of several scenarios occurs:
- Neither the commodity nor the job ever arrives.
- A real commodity arrives and the work exists but you cannot be hired.
- A fake commodity arrives and the job is fake.
Whatever the scenario, the jobseeker has spent hard-earned savings to obtain the commodity, will never see it back and will not be gainfully employed afterwards.
For example, you may be told that you’ll first have to enroll in an internet-based preparatory course. It will cost a few hundred dollars, and once you successfully complete the program you’ll be employed doing who knows what from home. So you pay using a credit or debit card and wait, but there’s no course. Nor is there any job. Apart from losing your money you’ve also provided your credit or debit card numbers to the scammer, who, of course, knows what to do with them.
Alternatively, the scammer may claim that work-from-home employment is readily available as a data processor for institutions like hospitals. But this type of work cannot be done without a special software application that only the scammer sells. The victims then invest in the software (which can be priced in the thousands, even tens of thousands of dollars) and it actually arrives. But when the victims contact hospitals to offer the new service they quickly discover that the jobs don’t exist. Hospitals don’t contract out billing services to an external party.
Another version is the old envelope trick. The scammer tells you that you can earn $2, $3 or even $5 dollars for addressing and sending out envelopes. You’ll probably have to buy them from him, since they’re a special size or feature a logo or who knows what. Or you’ll need special software. Whatever the case may be, you invest the money and then the instructions arrive. Your job is to send the envelopes to all your friends telling them that they too can work-from-home by addressing envelopes. Don’t even try. You won’t be paid for it even if you do.
Some work-from-home scammers will offer a work-from-home job, ostensibly in the import/export business, that requires you to use your bank account to make and receive payments on behalf of a foreign company. The scammers promise you a percentage commission for each payment you pass on. This is a telltale sign of money laundering, which is a felony. Moreover, any personal account details you pass on to the scammer can always be used to steal your money or commit other fraudulent offenses, such as identity theft.
A scammer who has used a stolen credit card for purposes of identity theft and uses it to make major online purchases cannot have them sent to his own address without giving himself away. Instead, he may place messages in the social media advertising a work-from-home job that requires victims to agree to have the packages delivered to their own homes. The scammer may claim that’s it’s merchandise he’s ordered for his business, but since he’s frequently out of the office or out-of-town on business, he has no way to accept delivery. He may even that it’s for a friend who is in that position.
The victims are instructed to forward the packages using their own money, which they’re told will be reimbursed. It rarely is, however, since the police may knock on your door first and arrest you.
Scammers who don’t want to use a stolen credit card, or don’t have access to one, will employ a slightly different method to make you pay for their expensive merchandise. They’ll advertise that a respectable nationwide or international company is looking for part-time employees who can work from home. They may even mention in the ad that the position involves purchases. And you’ll be promised a huge salary.
If you check them out, you’ll see they have an impressive website. So you inquire. You’ll be told that since capital expenses for items like computers, printers and wide-screen TVs varies across the country, your job requires you to look for the best prices in your area and update them on a regular basis. They’ll promise to send you a company credit card to make the purchases and have them shipped to their headquarters. You’ll soon receive a list of items they require immediately, but you’ll have to use your personal credit card in the meantime because the corporate one you’ve been promised isn’t ready yet. Or that company regulations require you to complete a probation period before being provided with one. At any rate, you’ll be fully reimbursed for the purchases you’ll be making for the company once they receive the items. Except that you won’t be. You’re being used as a mule. Once they get the equipment you bought they’ll disappear, website and all, and you’ll be stuck with the bill.
Certain work-from-home offers may actually involve some form of employment, but simultaneously function as elaborate pyramid schemes. New employees (who typically will work as distributors or door-to-door salesmen for a certain product) are promised financial rewards every time they recruit a new member to the team who sells a certain minimum number of products over a specific period of time. The more salesmen there are in the immediate vicinity, however, the less likely any of them is to sell enough of the products to make a living. In all likelihood they also will first have to purchase a significant investment beforehand by purchasing sample product kits, which is how the scammer makes his profit.
In 2016 the Federal Trade Commission reached a settlement with Herbalife, which was of operating its business as a pyramid scheme and fined it $200 million. Partial reimbursements were made to 350,000 people who ran Herbalife businesses.
If you think you’ve been the victim of a work from home scam, contact the fund recovery experts at MyChargeBack.