Work from Home Scams, Shemes and Frauds

Work from Home Scams

"Crazy like a Fox?"
No, They're "Thick as a Brick"

What are work from home scams?

"Imagine owning your own business, being your own boss, working only a few hours a week, but still making lots of money - all from your own home ..."

"Are they crazy?  Yes, crazy like a fox!"

"This billionaire spent months researching his next big investment!  Go here next!"

Advertisements from work-from-home schemes like Crazyfox (Crazy like a fox) and other scams are bombarding TV, radio and the internet. The general public has the naive belief that these must be true because "there are laws against false advertising" and "the government wouldn't let them say it on tv, if it weren't true."

Those beliefs are simply not true.  There are many scams and outright lies being advertised on television (see Kinoki foot pads for an example!).  The government has to become aware of the scam and see it as serious enough to take action, and as slow as government is, that could take years.  Scammers know this and feel safe in spreading their scams on major television networks!

It is up to you to protect yourself! Be wary of 'work from home' schemes where people are offered the possibility of working from home with the potential of earning thousands of dollars. An employment opportunity to work from your own home earning a great wage which may be no more than stuffing envelopes, but to get the material to stuff the envelopes you have to send money away, often to nothing more than a PO Box address. In return you receive the information that you have to photocopy at your own expense and then stuff the envelopes. Recently reported work from home schemes offer you the opportunity to earn thousands processing emails.

Work from home schemes may also be promoted through newspaper advertisements, direct mail drops or through unsolicited emails asking you to visit a website for more information.

Types of home-based business schemes

Common work-from-home schemes are:

  • stuffing envelopes
  • medical transcription
  • buy and selling real estate, "with no money down!"
  • Investment schemes
  • data entry,
  • processing applications
  • selling or reselling the schemes themselves

Other work from home type schemes require you to:

  • make gift items from home or
  • grow flowers for the export market,

but then require you to also sell these products yourself.

One characteristic common to these schemes is that you are required to invest or send away money before you can start work.

As good as the "wages" sound, the promoters don't give the full story. The schemes are often no more than phony get-rich quick schemes - where you're not the one getting rich!  In fact, our own investigations show that almost ALL work-from-home schemes, "passive residual income", make-money-in-your-spare-time and other get-rich schemes are pyramid schemes, scams or simply worthless.

Are there legitimate work-from-home opportunities?

Yes, but you need to evaluate each carefully! This page lists some that we believe are legitimate.

How to check out a work from home scam

  • Contact the Better Business Bureau to determine the legitimacy of the company.
  • Be suspicious when money is required up front for instructions or products.
  • Don't provide personal information when first interacting with your prospective employer.
  • Do your own research into legitimate work-at-home opportunities, using the "Work-at-Home Sourcebook" and other resources that may be available at your local library. 
  • Ask lots of questions of potential employers'legitimate companies will have answers for you!
    • Ask for a street address, not just a PO Box, and find out as much as you can about the company and its operations.
    • Ask to talk to other employees - and to ensure they are for real, visit them to see what type of work is involved and how they are organized.
    • Ask to see examples of the final product and the work required.
    • Ask what materials are supplied, or not supplied.
    • Ask how you will be paid - and in what currency.
    • Ask where the business is incorporated and where it's business license is filed.
  • Research the product - is it a viable money-maker, and are the proposed returns achievable?
  • Do the math - ask yourself whether the time required to do the job, in conjunction with the start up or material costs, match the returns to be expected.
  • Use common-sense: if you have never heard of the product, or their products are very expensive or there is a fee to sign up as a "distributor" or "consultant", those are tips that it is a multi-level-marketing scam.
  • Click here for the United States Postal Service's pdf explanation of work from home scams.

More Questions to Ask

Legitimate work-at-home program sponsors should tell you - in writing - what's involved in the program they are selling. Here are some questions you might ask a promoter:

  • What tasks will I have to perform? (Ask the program sponsor to list every step of the job.)
  • Will I be paid a salary or will my pay be based on commission?
  • Who will pay me?
  • Will I be expected to send money via Western Union?
  • When will I get my first paycheck?
  • What is the total cost of the work-at-home program, including supplies, equipment and membership fees? What will I get for my money?

The answers to these questions may help you determine whether a work-at-home program is appropriate for your circumstances, and whether it is legitimate or simply a scam.

You also might want to check out the company with your local consumer protection agency, state Attorney General and the Better Business Bureau, not only where the company is located, but also where you live. These organizations can tell you whether they have received complaints about the work-at-home program that interests you. But be wary: the absence of complaints doesn't necessarily mean the company is legitimate. Unscrupulous companies may settle complaints, change their names or move to avoid detection.

The most common work-at-home scams.

  • Advanced Fee Frauds: They claim that starting a home-based business is easy! Just invest a few hundred dollars in inventory, set-up, and training materials, they say. Of course, if and when the materials do come, they are totally worthless and you're stuck with the bill.
  • Just plain scams - Meaning the consumer pays a fee for a service, kit, coaching, training to work from home and the service or product is simply worthless.
  • Counterfeit check-facilitated "Mystery Shopper:" You're sent a hefty check and asked to deposit it into your bank account, then withdraw funds to shop and check out the service of local stores and wire transfer companies. You keep a small amount of the money for your "work," but then, as instructed, mail or wire the rest to your "employer." Sound good? One problem: the initial check was phony, and by the time your bank notifies you, your money is long gone and you're on the hook for the counterfeit check.
  • Pyramid Schemes: You're hired as a "distributor" and shell out big bucks for promotional materials and product inventories with little value (like get-rich quick pamphlets). You're promised money for recruiting more distributors, so you talk friends and family into participating. The scheme grows exponentially but then falls apart, the only ones who make a profit are the criminals who started it.
  • Unknowing involvement in criminal activity: Criminals often located overseas, sometimes use unwitting victims to advance their operations, steal and launder money, and maintain anonymity. For example, they may "hire" you as a U.S.-based agent to receive and re-ship checks, merchandise, and solicitations to other potential victims, without you realizing it's all a ruse that leaves no trail back to the crooks.
  • Envelope Stuffing
    For a "small" fee, the ad says, you'll learn how to earn lots of money stuffing envelopes at home. But once you pay, you find out the promoter never had any work to offer. Instead, after you send in your money, you get a letter telling you to get other people, even your friends and relatives, to buy the same envelope-stuffing "opportunity" or some other product. The only way you can earn any money is if people respond the same way you did.
  • Assembly or Craft Work
    According to the ad, you can make money assembling crafts or other products at home. You may have to invest hundreds of dollars for equipment or supplies - for example, a sewing or sign-making machine from the company, or materials to make items like aprons, baby shoes or plastic signs - or spend lots of hours producing goods for a company that has promised to buy them.
    But after you've paid money and done the work, the company doesn't pay you - supposedly because your work isn't "up to standard." Unfortunately, no work ever is, and you're left with equipment and supplies - but without any income to show for it.
  • Rebate Processing
    The ad in your email says you can earn money by helping to process rebates. And the fee for training, certification or registration is nothing compared to what you'll earn processing rebates from home, according to the promises in the ad. It says the #1 certified work-at-home consultant behind the program will show you how to succeed like she did.
    What you get are poorly written and useless training materials. There are no rebates to process, and few people ever see a refund.
  • Online Searches
    The ad on the website piques your curiosity - earn $500 to $1000 a week, or even $7,000 a month, running Internet searches on prominent search engines and filling out forms. Even better, you can be your own boss and do the work right from home. What have you got to lose, except a small shipping and handling fee?
    Unfortunately, you have a lot to lose. The company isn't really connected with a well-known search engine - scammers are just lying to trick you into handing over your credit or debit card information. If you pay them even a tiny fee online, they can use your financial information to charge you recurring fees.
  • Medical Billing
    The ads lure you with promises of a substantial income for full- or part-time work processing medical claims electronically - no experience needed. When you call the toll-free number, a sales rep tells you doctors are eager for help, and in exchange for your investment of hundreds - or thousands - of dollars, you'll get everything you need to launch your own medical billing business, including the software to process the claims, a list of potential clients and technical support.
    But companies rarely provide experienced sales staff or contacts in the medical community. The lists they give you often are out-of-date and include doctors who haven't asked for billing services. The software they send may not even work. Competition in the medical billing market is fierce, and not many people who purchase these "opportunities" are able to find clients, start a business or generate revenue - let alone get back their investment and earn any income. Many doctors' offices process their own medical claims, and doctors who contract out their billing function often use large, well-established firms, rather than someone working from home.
    To avoid a medical-billing scam, ask for a sizable list of previous purchasers so you can pick and choose whom to contact for references. If the promoter gives only one or two names, consider that they may be "shills" hired to say good things. Try to interview people in person where the business operates. Talk to organizations for medical claims processors or medical billing businesses and to doctors in your community about the field. Finally, consult an attorney, accountant or other business advisor before you sign an agreement or make any payments up front.

Add identity theft to the mix

As if these schemes aren't bad enough, many also lead to identity theft. During the application process, you're often asked to provide personal information that can be used to steal from your bank account or establish new credit cards in your name. 

Where to Complain

If you have spent money and time on a work-at-home program and now believe the program may not be legitimate, contact the company and ask for a refund. Let company representatives know that you plan to notify officials about your experience. If you can't resolve the dispute with the company, file a complaint with these organizations:

  • If you think you've been the victim of a work-at-home scam, file a complaint with the Federal Trade Commission's Consumer Sentinel or the  Internet Crime Complaint Center. Or call 1-877-FTC-HELP (1-877-382-4357).
  • The Attorney General's office in your state or the state where the company is located. The office will be able to tell you whether you're protected by any state law that may regulate work-at-home programs.
  • Your local consumer protection offices.
  • Your local Better Business Bureau.
  • Your local postmaster. The U.S. Postal Service investigates fraudulent mail practices.
  • The advertising manager of the publication that ran the ad. The manager may be interested to learn about the problems you've had with the company.

Read the fine print on the commercials!

Almost all of the scam work-from-home schemes advertised on television have fine print briefly superimposed along the bottom of the screen, usually while something distracting is being shown, like a pretty blond in a bathing suit talking about how she bought the mansion behind her with the money she earned. and other commercials typically say:

  • "There are no guarantees of specific income nor are there any representations of actual income.
  • Amounts stated are for illustrative purposes only and are not typical.
  • Persons depicted are paid actors."

The website has this at the bottom:

  • The incomes depicted are not typical and represent a small percentage of actual participants. There are no guarantees that participants will be able to achieve the income levels depicted. Each individual's success will be determined by his or her desire, dedication, effort, ability to follow directions and personal talent. The actual contents of success kit may vary than what is depicted.

On another Crazy like a fox alias website,  you will find this statement (seen on May 5, 2008):

  • There are no guarantees of specific income, nor are there any representations of actual income.  Amounts stated are for illustrative purposes only and are not typical. Persons depicted are paid actors.

Those statements ought to be a BIG clue that they are selling you an illusion... in other words, a scam.  Read the statements again.  Essentially they are saying that everything you hear the paid actors saying is NOT typical and will not be backed up by anything.

Their small print  disclaimers negates almost everything the actors are saying.

Generally, you're paying for a pretty worthless booklet which tells you how wonderful it would be to be your own boss and make big money, set your own hours, etc., but no plan or details on how to achieve that.

Of course, when you ordered the "kit" you gave the scammers your name, phone number and address; which they will promptly sell to many other companies who will then start calling you to sell more services and schemes.

When it comes to business opportunities, there are no sure bets. Promises of a big income for work from home, especially when the "opportunity" involves an up-front fee or divulging your credit card information, should make you very suspicious. It doesn't matter if the ad shows up in a trusted newspaper or website - or if the people you talk to on the phone sound legitimate. The situation demands both research and skepticism.

Examples sent in by visitors:

And please let us know about any suspicious calls or emails you receive.  We look for patterns so that we can alert the authorities and victims to new scams, before it is too late!


For a comprehensive list of national and international agencies to report scams, see this page.