Work From Home Scams

June 07, 2016


Better known as:  Extortion

Who wouldn't want to work from home on a part-time basis while earning thousands of dollars a month? The lure makes it difficult to refuse. Unfortunately, work-at-home scams end up COSTING you money, instead of the riches you hoped for.

"It's hard to distinguish legitimate work-at-home programs from people who are just out to get your money," says Blair Looney, President and CEO of BBB serving Central California & Inland Empire.

Telecommuting is a thing. 

Three decades have passed since the concept of telecommuting— the substitution of technology for commuter travel—was conceived.   Some occupations and industries are much more likely than others to offer real opportunities for at-home work

According to, the typical telecommuter is an older (50+), college educated, salaried, non-union employee.  50% of the US workforce holds a job that could be telework.  Approximately 3.7 million employees (2.8% of the workforce) now work from home at least half the time.  Estimates state that a typical business can save $11,000 per telecommuter per year, and telecommuters can save between $2,000 and $7,000 per year.

Fortune 500 companies around the globe have entirely revamped their office space to accommodate mobile workers, even though most work-at-home employees are not 100% full-time telecommuters. Aetna, Xerox, and Dell save millions of dollars in real estate, gas, and CO2 emissions per year.  All three organizations state that employees who telework are more engaged, productive, and happy at work.

Going forward it’s hard to imagine flexible work not being a core strategy for organizations seeking to attract and retain top talent.

Top Scam-Ridden Offers

Here are some of the top scam-ridden work-at-home “occupations:”

  • Envelope Stuffing: The classic example of a business that is not real.  The "envelope stuffing" model originated in the U.S. during the Depression.  Why would someone pay you $1 to stuff an envelope, when it can be outsourced to a mailing house for pennies per piece?
  • At-Home Assembly Work: This is also highly suspicious. If these companies were legit, why wouldn't they be using offshore labor at a fraction of the cost?
  • Medical Billing or Claims Processing: Very few medical professionals will let just anyone handle private medical information, especially with healthcare privacy rules. Most doctors will not outsource billing services to individuals, but rather to established companies whose workers are trained, insured, and employed on site.
  • Refund-Recovery Business: In this work-at-home scheme, the scammers offer to sell you software to track late or lost UPS and FedEx packages, and assist the shippers' customers in obtaining refunds. The shippers say these refund-recovery schemes are bogus.
  • Deposit Money & Wire Back:  This is part of a new family of scams that have different hooks, such as Ebay/Craigslist fraud, or “Mystery” shopper scam, or “Car Wrap” scam.  Legitimate companies don’t pay you more than the agreed upon price, and then ask you to wire money back to them. If you’re tempted, don’t withdraw any funds until your bank tells you the check is valid – about 2 weeks.


How can I tell if it’s a real offer?

An interesting point about fraud is that it is a crime in which you make a decision whether or not to participate. Hanging up the phone -- or not responding to questionable mailings or emails -- makes it difficult for the scammer to make you an accessory to fraud.

In general, beware of work-at-home employers who ask you to pay them money up front. Legitimate employers pay you, not the other way around.  Christine Durst, author of "The Rat Race Rebellion," says her research indicates the ratio of scams to legitimate opportunities is 42-to-1.

If the employer will hire anyone -- with no experience necessary and no qualifications – it is probably a scam.  Legitimate work-at-home employers are only interested in employees who have the proper experience, skills, and certification. A work-at-home scammer is only interested in your payment required.

If the company is unknown, and does not seem to have a customer base bringing them revenue, as an employee, it should raise red flags.

Run an online search with the name of the business and the word “Scam.”  Chances are, a bogus business has some complaints. 

What can I do if I’ve been scammed?

If you have been scammed, report the fraud and file complaints with:

The District Attorney, Sheriff, local police and local prosecutor in your community.

The California Attorney General.

The Federal Trade Commission.  The FTC tracks and prosecutes scammers.

The Federal Bureau of Investigation. The FBI also has a dedicated Internet Crime Complaint Center (IC3).

The Consumer Financial Protection Bureau.

If any of the communications or payments were made through the mail, file a complaint with the U.S. Postal Inspection Service.

If you’d like to share your story, you can post to

Check with your Better Business Bureau (BBB).  Your BBB has a data base of thousands of businesses, with customer reviews and complaints.  BBB fields telephone calls every day, and are one of the first lines of defense for the protection of consumers.  Your BBB has the Scam Tracker, a tool to warn consumers of trending schemes and fraud covering North America.