You've seen the ads online all over the internet; "Work from home using your PC" "Make money online!" "Be your own boss" "Quit your job and stay at home"... The idea of working from home and being your own boss appeals to many, for obvious reasons; No commute or traffic, can work all day in your pajamas, no boss breathing over you, no deadlines but your own, and being in control of your own destiny. Who wouldn't want that? Obviously many do, and that is why you see so many ads for online businesses or other work at home jobs or businesses. While there are very legitimate businesses offering work from home opportunities, sadly there are many more that are schemes or frauds. The purpose of this website is to shed some light on these frauds and give you a heads up on what to look for in a legitimate business. The Common Frauds Most of the work at home frauds that I've come across do their best to appear as a legitimate means to make some extra cash or even quit your job and make the big bucks. You may see their ads anywhere on the net, in the little gooooooogle ad bars on your favorite news page, when you do a search for other things, and even in your email. The ads may say things like “Earn extra cash from home” or “make $$$ using your PC” Usually just a quick little blurb to peak your interest. Again, not ALL of these are frauds or schemes, legitimate businesses use the same types of ads – adding even more confusion on figuring out what’s real and what’s not. So let’s address the most common schemes running amok on the net today (and even in your local classifieds): Envelope Stuffing. Usually, for a small fee, the schemer will tell you how to earn money by stuffing envelopes at home. After you pay, and when it’s too late to get your money back, you’ll find out that you must find “clients” on your own. Even worse, you’ll be told to do the same scam – place an ad in the paper like the one you responded to, and scam those people to do the same, and it goes on forever, a bunch of scammed people perpetuating the scam. Don’t fall for it! “Make money assembling items at home!” So you think to yourself, this should be easy. Well, after you invest lots of money (hundreds even) into equipment/supplies/etc, you usually will spend hours assembling whatever item that they are asking of you. Sometimes you may even have to buy special items from the company such as sewing machines or specific assembly pieces (thus the company gets more money from you). After you assemble all these things and send them in – the company will either ignore you and not pay you, or tell you that your items were not up to quality standards – so you get nothing. It doesn’t matter if you assembled these things perfectly, they will NEVER be up to quality standards – thus the scam. Don’t take these jobs thinking to yourself “Well, I can assemble things properly” – it simply doesn’t matter. It’s not legitimate, and you’ll never get paid, no matter how good your workmanship is. Scam! Medical Billing My wife has done medical billing for big doctors for the past 15+ years and she’s worked EXTREMELY hard to get the skills necessary to do this job. The mass amount of codes, medical knowledge and a whole bunch of other stuff that blows me away is just insane! The idea that you can just “hop” into something like this and make the thousands (Make “$50,000 or more a year!” these companies claim is ludicrous. But assume you learn fast, and maybe even have MB experience. It’s STILL a scam. You respond to these ads, send HUNDREDS or even THOUSANDS of dollars to these people to get their Medical Billing Package. Usually you are getting some outdated POS software suite, an old funky database of doctors THAT DON’T WANT MEDICAL BILLING SERVICES, and worse, you are never told that the competition for medical billing is extremely fierce. There are several large firms that have a strangle hold on most of the business, and unless you are very experienced and can offer a LOT to convince that Doctor that he absolutely NEEDS your services over this big corp. that’s probably been doing just fine – you’re going to end up with expensive software and other “fees” you paid these guys, and no clients. The Federal Trade Commission has brought charges against some companies for misrepresenting the earnings potential of medical billing centers and failing to provide certain key investment information that the law requires. If you MUST check into this, here is what the FTC recommends: Check out the company! Check with the Attorney General, consumer protection agency, and the BBB. Call the Secretary of State where the company is headquartered to determine how long it has been in business. Get all earnings claims in writing. Insist that the promoter give you written substantiation. Be sure it includes the number and percent of others who have earned at least as much as the promoter claims. If the promoter hesitates or refuses, walk away from the deal. Don’t believe what was said about sales, profits or income. Be skeptical of past success stories. Don’t rely solely on the names given to you by the promoter. Fraudulent companies sometimes hire "references" to speak to potential investors about earnings claims. Ask the promoter to give you the names of all or many previous purchasers so that you can pick and choose who to call. When speaking to references, ask them for the names of their clients and details of their operations. If the promoter or the references hesitate or refuse, walk away from the deal. Consult an attorney, accountant, or other business advisor before you sign any agreement or make any payments upfront. Typing/Reading Scams I believe these scams have ads that say things like “home typists needed”, and ads that may say “read books at home to make money”. They have you call an 800 number usually, and then you are in a high pressure sales call where they want to sell you a book that will tell you how to get jobs typing at home or reading books. They are overpriced and usually have very little info. So while it’s not really a “scam” – it’s useless and is just another way for you to be separated from your money. Chain Letters Not only are chain letters (pyramids, Ponzi’s, etc) a scam they are ILLEGAL! They will ask you to, say, send $5 to the person on the top of the list, put your own name on the bottom, and then mail it out to X number of people. Sometimes they will try to get around being illegal by saying you’ll receive something – like maybe a report or a book. If it is asking for money (or other valuables) and offers to make you rich in exchange EVEN if they offer something for your money – it’s illegal. Title 18 of the US code, section 1302 reads “Further, whether the letter comes snail mail, e-mail or any other route, it is still illegal because the mail is used at some point, at least to send the money. “ You may also see these with PayPal or StormPay – “DOLLAR BLASTERS” or some other clever name associated where you put some money into someone’s paypal account, put your name on the bottom of the email (or web page), etc. STILL ILLEGAL – and Paypal / stormpay / etc WILL close your account – it is strictly against their rules. Don’t fall for “This is LEGAL” statements. If they are saying that, likely there is a reason – THEY KNOW THEY ARE ILLEGAL and are trying to convince you otherwise. Don’t be fooled by these scams. Finally, even if you think “so it’s illegal – does it work?” – No they don’t. Most people who participate just throw their name on the bottom WITHOUT sending the money to the guy on top. Sometimes there may be many names and addresses, but it’s all going to one person. Scam. 100% Move on… “I son to rich dead president man in nigeria praise god he sends me to you…” I’m SURE you’ve seen these in your inbox. Some noble in some other country is emailing YOU personally. You are the ONLY one he can trust! Praise God that he has found you! His father was a president of some big company and has MILLIONS tied up in a corporate account. He needs a foreigner to transfer the money to so he can untie it and get it back to his family. He’ll give you a percentage even, for your efforts and time. This is one of the most dangerous of all scams out there right now. People are DYING because of this scam. Often you’ll be asked to fly and meet these people, as others have, and have gone missing. Usually the scam is simple, they want your banking info so they can transfer the millions into your account. You give them that info, the next day, your account is empty. Sometimes it can get more elaborate, and that’s the danger. They’ll try to convince you to meet with them, talk to them on the phone, etc. There have been reports of people flying over there, been given a suitcase of money (fake) – and then being left with nothing – no money and no way home. It’s scary to think people are falling for this and losing everything, even their life. Simply DO NOT respond to these messages, and forward them to the FBI. This is BIG MONEY in these countries. They are run by lots of people trained to scam you. This isn’t some country bumpkin playing on his paws PC. It is a dedicated crime ring and they make a lot of money scamming people. Best to not reply at all. There was an interview with one of these people a while back on some site (I don’t recall where, I just remember reading it). The scammer said he’d get replies from people cussing him out, telling him he’s a liar, etc. – he was so good at scamming these people, that often he turned it around and convinced them of his legitimacy. The promise of millions of dollars can make people lose their logic – don’t respond to these people. This is your bank EMAILING you – you better answer You may get an email from your bank saying you need to update your info, or some other thing OR ELSE. Ok, would you bank email you in the first place? Then, would they threaten you? Give me a break. Seriously, this is lame, because people fall for this and LOSE EVERYTHING IN THEIR ACCOUNT. Do not click on these emails, and send them to the FBI. Call your bank if you must know what’s going on with your account. They would call you, not email you. (Do they even HAVE your email?) Hello, this is PayPal, your account is going to be shut down unless you do something now! Again, you may get a very official looking email from paypal saying your account needs updating, or there is a problem, etc etc. First off, don’t click on anything in the email. Open a new browser and type in https://www.paypal.com <- notice the S in there. That means it’s secure AND you KNOW you’re going to Paypal’s account ONLY. Then, you can log in and check to make sure everything is kosher. If there was a problem, it would tell you there. NEVER click on these emails. They send you to their own Spoof server and get your paypal info. They’ll clean it out or use it to make purchases. I’m a foreign Gold/Jewler/other valuable importer and I have chosen YOU You may get an email saying that this gold/diamond/other valuable importer needs your help importing some goods. He’ll give you a cut of the profits or some of the merchandise for his help. Basically, it’s similar to the Nigerian scams. They will try to get your bank info or they’ll try to meet you and extort money from you. Ignore these, or send them to the FBI. You’re choice. It’s a fraud. Come to think of it. Any unsolicited email offering something is probably a fraud. Just assume guilty until proven innocent. And even then, why waste your time? I doubt it’s legitimate. Network Marketing Ok Network Marketing is a legitimate and PROFITABLE way of doing business. However, there ARE some people out there operating under the “banner” of network marketing but are really frauds. Network Marketing is a legitimate and LEGAL way of doing business, and quite profitable if you are working with the right company and people. Randy Gage has a book called “How to Build a Multi-Level Money Machine”. (Network marketing is often called Multi-level marketing) In this book he describes the differences between a legal network marketing opportunity and an illegal pyramid scheme. He says a legitimate network company compensates based on the volume of product moved through a person’s organization. They are paid based on the amount of product sold by others they recruit and train. Illegal pyramid schemes compensate (or say they will) for recruiting others into the pyramid. Legitimate network companies don’t compensate for the act of getting a recruit. They compensate for a percentage of how much a recruit sells. Network marketing is all about the distribution of products, illegal pyramid scheme are about recruiting people. That’s the difference. Pretty simple? Yes, as I write it here…but sometimes it’s hard to tell. Many people erroneously think that because network marketing resembles a pyramid in its structure, it is illegal. In reality, almost all organizations in existence (from our government to the local non-profit businesses) resemble a pyramid in the hierarchy setup. You have a president, then a vice-president or many, Directors, Supervisors, middle management, and then the base workers. With that in mind, the pyramid structure is not what makes a pyramid scheme illegal. Getting a person to pay money to join an organization and then getting others to pay to join and getting compensated off of recruiting those people is illegal. Like you read earlier, that is just like a chain letter. So while it may seem simple as I write it in what is legal/illegal legitimate/not – sometimes it’s not so easy to figure out. Randy Gage has some basic things to consider when you are looking at joining a network marketing company. These are good guidelines on figuring out “is this legal/legitimate?” The focus of the company should be distribution of products to "ultimate" users. An ultimate user is essentially customers and not thousands of dollars of inventory in one person's garage. Commissions are paid on product distribution (sales), not for the act of recruiting. "If you are paid simply for recruiting, or for selling training, distributor kits or training materials- then you're in a pyramid." States with network marketing laws require companies to repurchase inventory returned by distributors. Sometimes there are different policies about how this is done but, the purpose is to prevent a distributor from having a garage full of products he can't afford with little ability to sell it. You can always find someone somewhere who tried network marketing 20 years ago only to end up with a 20 year supply of soap. Legitimate network marketing companies tend to discourage buying too much inventory. So if the company you are looking at seems to adhere to the basic principles above, it is likely legitimate and within the law. That said, if you are looking into an MLM / Network marketing business that is legitimate and successful (and adheres to all of the above in spades) I recommend you check out this site for more information. If you are really looking for a home business, this is an excellent way to go. I personally know some of the people who are making VERY nice money and are excellent coaches and can train you to do it exactly like they did. There are a few testimonies on that site – they are real, I have met most of these people face to face. They have one of the nicest systems set up in any network marketing I have seen to date. I highly recommend it! Check it out if you’re serious about getting a home business going: working.theonlinebusiness.com Pyramid Schemes Ok so we touched on the differences between network marketing and pyramid schemes above. But to be very simple, the difference comes down to one thing; A product. Network marketing involves the distribution of a product. The product is sold by a representative and by any people the representative has sponsored and trained. Because the structure of a network marketing business looks like a pyramid, as stated above, many think they are illegal. The true illegal pyramid scam involves no product. Basically, you give your money to some one who then helps you recruit people to give you their money. Sometimes there MIGHT be a product involved, maybe a small manual or a report of some sort – but if you are paying to be recruited, and then get paid for recruiting – it’s a pyramid despite the fact there might be a “product” exchanging hands. Also, they may try to dilute the truth further by calling it an investment or some such thing. That’s about it for the common scams online and off. Just use your head. Legitimate opportunities and jobs are actually rather easy to spot. If it’s a job – they shouldn’t be asking you for a dime, period. If they do, and it’s a JOB, then it’s time to BE WARY. If it’s a business opportunity (such as network marketing) then yes, you’ll need money to begin. Usually the costs vary, depending on what you get. If you are just going to be a “base” distributor with the company, expect to pay under $100.00 – but also expect not much else other than the ability to sell the company’s products. That means you’ll have to rely on yourself to sell products and advertise. Often network marketing businesses offer a more premium package, such as web sites, special advertising opportunities, and various other things that really accelerate your business. Of course you’ll have to pay more for these things, but it’s definitely something to think about if you’re serious about starting your own business. For example, to start a restaurant franchise business it cost many thousands of dollars to get going. But these network marketing opportunities can cost a couple hundred or a couple thousand – really nothing compared to a bigger franchise. The point is, if you are starting your own business, expect to put some capital and TIME into it. All good things require hard work. And that’s the key to all these scams and frauds – if it’s offering big money with little effort – well, the old saying applies “if it looks too good to be true, it probably is”. One final note about network marketing opportunities: If there isn’t a real person behind it, then you should raise the RED FLAG warning. Often the person you first talk to is going to be your direct upline – your coach. If you never hear from them or can’t get in contact with them, is that how it’s going to be for you always? Definitely something to think about. You should be talking to a real person fairly soon in the process. That’s key in finding a legitimate network marketing opportunity. Good luck on your search for financial freedom! May you find the perfect business for you… (and again I recommend checking out working.theonlinebusiness.com for a truly legitimate and ultimately fun business.) Zaose.net staff July 20th 2005