Full Guide on Work-from-Home Scams

Even before the events of 2020, none of us wanted to go to work. Why would anyone? The alternative is being home, working independently, and most importantly: not wasting gas.

It should come as no surprise when hopeful people apply to work-from-home scams by accident. These scams manipulate the applicant, who is already desperate (or hopeful) to find employment. 

In doing so, the scams gain a lot of personal information. Scammers can harvest Social Security Numbers, bank account numbers, and more during the onboarding process for a job. That puts the applicant and their family at risk for fraud, identity theft, and many other criminal activities.

What are Work-from-Home Scams

Scammers come at the victim from the business side, looking for employees. The scam manipulates the victim’s trust and encourages them to share information about themselves for later use. Or, in some instances, the scammers trick the victim into giving them money directly.

Work-from-home scams are such a common threat that the FBI published a page on them in 2009. They suggest contacting “the Better Business Bureau to determine the legitimacy of [any] company.” Reporting is critical if an applicant applies to job postings from sites like Craigslist, Fiverr, or Upwork.

Scammers can use the guise of legitimate work-related communication to trick individuals into providing sensitive information or making payments. For work-related discussions or file exchanges, workers should use only trusted employee apps, provided by their employers or HRs.  It's important for remote workers to be cautious when using other apps, and to verify the legitimacy of any job postings or communications they receive through them.

Additionally, those who use information sites can benefit from looking at a company. Email records and other public information can go far in assessing if a company is a threat.

There are many different types of work-from-home scams. Luckily, once you learn how to spot them, they become glaring when they pop up.

Different Types of Work-from-Home Scams

Recruitment: Also Called Multi-Level Marketing (MLM or Pyramid) Scams

Recruitment scams are some of the worst offenders at stealing a victim’s money. They operate by encouraging a person to buy their product and then sell it to friends and family. Eventually, the criminal will influence the first victim to recruit more people to do the same for a small kickback.

The Federal Trade Committee (FTC) has published works regarding understanding these scams better. They warn, “MLM compensation plans assume an infinite market and a virgin market, neither of which exists in the real world. MLM is therefore inherently flawed, unfair, and deceptive.” Said another way, these scams take advantage of a person’s inexperience with business; they then weaponize it for monetary gain.

Medical Billing

Medical professionals and businesses will often utilize billing firms to keep up with transactions. In the last decade, the demand for medical billers has skyrocketed, making it a good disguise for scammers. They pose as representatives of the medical billing community, promising overflowing employment opportunities. Victims may have to pay for equipment, classes, or fees.

Medical billing scams work by offering people a series of “classes.” The person becomes a “licensed” medical biller at the end of the classes. From there, the victim cannot find work—because medical professionals use billing professionals. The criminals will gain much from this scam, including money and personal information.

A Faulty or Fake Check

Fake checks have evolved to include the “faulty deposit” scam now that direct money transfers are possible. In the case of work-from-home scams, they work by a scammer employer transferring way too much money. They then request the difference back, and if the victim gives it to them, they lose that money. In reality, the victim is never paid for their work, and they can lose thousands.

The Federal Deposit Insurance Corporation (FDIC) also warns about similar fake check scams, including:

• Winning lottery scams: victims pay for “taxes” and a “claim” fee
• Online auction scams: victims pay for the difference in an overpaid check
• Mystery shopper scams: victims pay for an “account activation”

Pay for Training Opportunities

These scams take advantage of those looking for more or better employment. Often, they consist of offering training or studying for a modest fee. Victims may receive something from scammers, but the thing the victim “pays” for is often already free.

Other times, they may claim that government positions are all pay-to-apply, which is not true. It is always free to apply for federal or postal employment. Additionally, scammers may suggest that they can “boost” a resume or a test result—they cannot do either.

Recognition and Prevention

Recognizing a Work-from-Home Scam

Work-from-home scams are everywhere on the job market. That means that once a person learns the signs of one—the others can be more easily avoided. There are many ways to recognize a work-from-home scam, such as if the employment seems "too good to be true" (it is) or if the employer communicates poorly.

However, two important markers should give applicants big red flags for avoidance. One quality is if the employer is over eager to hire or okay with jumping over average onboarding processes. The other marker is if the applicant looks online and finds little to no information about the company.

Preventing A Work-from-Home Scam

There are many ways to avoid work-from-home scams—the key is to be proactive and cautious when approaching new opportunities. For example: not clicking on or interacting with unknown calls, texts, emails, or ads.

Additionally, becoming more aware of the scams that could affect your employment hunt is a good choice. A seasoned supervisor may not fall for the same scam that a hairstylist does; that doesn’t mean they couldn’t fall for one tailored to them.

In Conclusion

Work-from-home scams are a byproduct of the internet and a progressive approach to employment needs. They work by taking advantage of a person’s desire or need for work; this is only possible because of the way they manipulate the individual. The scams promise stable work and pay—but they will only steal from a victim.

Work-from-home scams have reported more than $24 million worth of lost money in the universe of income scams. This means they are not the most lucrative scams a criminal can commit (investment scams). Despite this, the individual who falls prey to a work-from-home scam must take precautions and action against the perpetrator.