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Work At Home Scams


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Facts for Consumers from the Federal Trade Commission

Work-at-Home Schemes -- March 1993

In newspapers and magazines around the country you may see ads
like this:

Would you like to earn hundreds of dollars a week at home, in
your leisure time? Many people are supplementing their income in
a very easy way. Let us tell you how...

An offer like this may sound very attractive, particularly if you
are unable to leave your home to work. But, be cautious about
work-at-home ads, especially ones that promise you large profits
in a short period of time. While some work-at-home plans are
legitimate, many are not. Home employment schemes are among the
oldest kinds of classified advertising fraud.

What many of these ads do not say is that you may have to work
many hours without pay. There also may be hidden costs. Many
work-at-home schemes require you to spend your own money to place
ads in newspapers, make photocopies, or buy the envelopes, paper,
stamps, and other supplies or equipment needed to do the job. The
company also may demand that you pay a membership fee or make
regular payments in order to get continued instructions or
materials. Consumers deceived by these ads have lost thousands of
dollars and have wasted their time and energy.

Common Work-at-Home Schemes

Work-at-home ads may advertise these types of employment:

l Envelope-Stuffing. Work-at-home schemes come in many
varieties, but the most common type is envelope-stuffing.
Promoters of these programs usually advertise that, for a "small"
fee, they will tell you how to earn money stuffing envelopes at
home. Only when it is too late do you find out the promoter
really has no employment to offer. What you are likely to receive
for your fee is a letter telling you to place that same
"envelope-stuffing" ad in newspapers or magazines, or to send the
ad to friends and relatives. The only way you will earn money is
from the people who respond to your work-at-home ad.

l Assembly or Craft Work. Assembly or craft work is another
common type of work-at-home scheme. These programs often require
you to invest hundreds of dollars in equipment or supplies or
many hours of time to produce goods for a company who has
promised to buy them. For example, you might be required to buy
from the company a sewing machine, a sign-making machine, or
materials to make items such as aprons, baby shoes, or plastic
signs. However, in fraudulent schemes, after you have purchased
the supplies or equipment and performed the required tasks, the
company does not pay you for your efforts. Many consumers, for
example, have had companies refuse to pay for their work because
it did not meet "quality standards." Unfortunately, no work is
ever "up to standard." Thus you are left with relatively
expensive equipment and supplies, and no income. In reality,
those who produce goods in response to such ads must usually find
their own customers.

Precautions Against Fraudulent Schemes

If a work-at-home program is legitimate, its sponsor should
readily tell you _ in writing and for free _ what is involved.
Here are some questions you might ask a potential employer:

l What tasks will I be required to perform? (Ask the program
sponsor to list every step of the job.)

l Will I be paid on salary or commission?

l Who will pay me?

l When will I get my first paycheck?

l 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 enable you to detect whether a
work-at-home scheme is legitimate and to guard against the loss
of your money and time.

You also might wish to investigate the company's reputation by
checking with the consumer protection agency and the Better
Business Bureau in the area where the company is located. These
organizations can tell you if they have received any complaints
about the work-at-home program that interests you.

Where To Complain

If you already have spent your money and time in a work-at-home
program that you now have reason to believe may not be
legitimate, contact the company and ask for your money back. Let
the company know that you plan to notify officials about your
experience. If you cannot resolve the dispute with the company,
here are some organizations that may be able to assist you:

l The Attorney General's office in your state or in the state
where the company is located. That office will be able to advise
you if you are protected by any state law that may regulate
work-at-home programs.

l Your local consumer protection offices.

l Your local Better Business Bureau.

l Your local Postmaster. The U.S. Postal Service investigates
fraudulent mail practices.

l The advertising manager of the publication that ran the ad
you answered. The advertising manager may be interested to learn
about the problems you have had with the company.

l The Federal Trade Commission. While the FTC cannot help
resolve individual disputes, the agency can take action if there
is evidence of a pattern of deceptive or unfair practices. To
register a complaint, write to: Correspondence Branch, Federal
Trade Commission, Washington, D.C. 20580.

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