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Great article, courtesy of ABCNews.com:
Creative Consumer: Avoid Work at Home Scams
Want to Make Some Fast Cash While Staying Home? Well Think Twice
By ELISABETH LEAMY
ABC NEWS Consumer Correspondent
Feb. 11, 2008
This week's column was inspired by a New Jersey resident who wrote in asking about a work-at-home offer. As always, I love hearing from you. With the tight economy, I suspect lots of people are tempted to look into ways to make extra money. Sorry to say, 99.9% of work from home offers are scams designed to take your money -- not make you money. For more details, read on.
Question: I have received several emails over the past couple days regarding working at home processing consumer rebates. One site specifically guarantees it works or double your money back that you spend up front. Apparently you can make $15 for every rebate processed. The site says you can process a rebate on an average time of 4-5 minutes making approximately $180 to $225. Are these legitimate?
Answer: I could tell the opportunity was a fake before I even read it. Why? Because it was sent by email. Let's use logic here. If you knew of a great, easy, guaranteed way to make money, would you be emailing strangers to tell them about it? Of course not. Any business opportunity, medication, investment or product that comes to you via a spam email is automatically suspect. Period. In fact, let's coin a new mantra: spam = scam.
But let's just say the message in the email had been printed in a classified ad or posted on a telephone pole instead. The second clue is the following: "it works or double your money back that you spend up front." Anytime a business opportunity requires you to spend money in order to start making money, that's a telltale sign of fraud. Processing consumer rebates is just the latest hook. Here are some of the classic work-at-home scams of all time.
The arts and crafts scam is a crafty way to take advantage of people who are crafters. The ads claim you can make money assembling jewelry, knick knacks and decorations at home. You pay money up front for a kit full of raw materials. When you get the raw materials, you discover the finished product is almost impossible to make. Plus the promoter will only pay you if you make a specified number of products. If by some miracle you do manage to make your quota, the con artists have an answer for that too: they tell you your finished products are sub-standard and they refuse to pay.
Danielle W. wanted something she could do at home while on maternity leave. She paid fifty dollars for a kit to make twenty-four necklaces. When she got the kit, she discovered the string was too thick to fit through the beads. Undeterred, she bought her own replacement string. But the beads were so tiny that Danielle started getting headaches trying to see the holes. You'd have to have the eyes of an eagle and the patience of a saint to complete even one necklace.
I once went undercover and ordered one of these kits to prove the point. We chose a woodworking project in which we were supposed to assemble teeny, tiny little wooden boxes. We took the kit to a professional wood shop and asked the experts to give it a try. After three painstaking hours, the pros gave up. Besides, who would want to buy a wooden box the size of a pack of gum?
Envelope-stuffing is the other classic work at home scheme. You've seen the want ads: "Make an extra $200 a week stuffing envelopes." The ads ask you to send money for more information. When you mail in your check, you get a packet that explains how to get into the envelope stuffing business. But there is no legitimate business. The packet teaches you how to take advantage of the next set of suckers. You're told to place your own classified ad then photocopy the very packet you're reading and send it to anybody who responds. That's the only envelope stuffing involved. If you follow this advice, you could be prosecuted for mail fraud. The postal inspector's office considers envelope stuffing an elaborate, illegal chain letter.
Often envelope-stuffing ads imply that there are big corporate clients eager to pay people to prepare their mailings for them. Just to show how ludicrous that is, I once did a little experiment. On live TV, I folded, stuffed and licked as many envelopes as I could in one minute. My total? Five envelopes. That's three hundred envelopes an hour if I don't get a paper cut on my tongue. Ouch! By contrast, professional mailing companies have machines that can easily collate, fold, stuff and seal 5000 envelopes an hour.
Do Your Homework
Personally, I would never believe any work-at-home offer sent via email, advertised in the classified section of the newspaper or posted on a telephone pole. If you want to work from home, find a legitimate, well-known company and see if it offers telecommuting positions.
If you insist on pursuing a work-at-home offer you see advertised, find out the name and phone number of the company and check its reputation with the Better Business Bureau and your county and state consumer protection offices.
How to Complain
The U.S. Postal Inspector investigates many work-at-home scams because the kits are usually sent through the mail. If your kit is delivered by some other method, contact your county and state consumer protection offices and your state attorney general for help. File a complaint with the Better Business Bureau to warn other consumers that you had a bad experience.
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