Employment Scams

According to industry experts, U.S. corporations announced 95,000 job cuts in June 2002. With that many individuals looking for work, some are bound to become targets for less-than-reputable businesses willing to take advantage of their employment situation.

If you are looking for a job, you may come across ads for firms that promise employment results. Although many such firms are legitimate and helpful, others may misrepresent their services, promote outdated or fictitious job offerings, or charge high upfront fees for services that may not lead to a job. Some ads may direct you to call a toll-free 800-number. Once you are connected, you may be switched to a pay-per-call 900-number without your knowledge, or you may be asked to call a 900-number without a proper fee disclosure. Both practices violate federal law. 

Too many consumers who respond to these ads think they are contacting a bona fide placement service that is seeking candidates to fill specific jobs. Instead, they reach a business that creates the impression that consumers obtain employment through use of its "services." To make matters worse, such businesses typically charge advance fees - ranging from several hundred to several thousand dollars - for their services. Sometimes the fees are imposed without consumer approval, or the consumer is led to believe that most or all of the fees ultimately will be refunded, which turns out to be false.

When you are looking for help in finding a job, it is important to understand the differences among employment services. Many terms, such as employment agency, personal placement service, executive search firm, or executive counseling service are used interchangeably. Find out what services a firm offers, how much the services cost and who pays. If you are required to pay the fee, find out what you will owe if the employment service does not find you a job or any employment leads.

Before you send any money responding to job ads or completing job placement contracts, the Better Business Bureau, along with the Federal Trade Commission, suggest that you:

  • Be suspicious of any employment-service firm that promises to get you a job.

  • Even if employment service firm guarantees refunds to dissatisfied customers, check on their reliability with outside sources like the BBB or local consumer protection offices.

  • Do not give out your credit card or bank account information over the phone unless you are familiar with the company and agree to pay for something. Anyone who has your account information can use it to take money from your accounts improperly.

  • Get a copy of the firm's contract and review it carefully before you pay any money. Understand the terms and conditions of the firm's refund policy. If oral promises are made that do not also appear in the contract, think twice about doing business with the firm.

  • Follow-up with the corporate offices of any company listed in an ad by an employment service, to find out if that company is really hiring.

  • Be wary of firms promoting "previously undisclosed" federal government jobs. All federal positions are announced to the public.

  • Check with the BBB to see if any complaints have been filed about a company with which you intend to do business.

There are a variety of free and low-cost resources available to help you in your job search, including local and state government job service offices, the Internet, local libraries and universities and community colleges.