3 Scams Targeting Home-Based Entrepreneurs and Online Job Seekers

Here’s how you can avoid them

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Small Business Owners Beware of Billing Scams

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Many people believe scams are obvious and easy to avoid, but unfortunately, there are an increasing number of sophisticated scams. There are an estimated 60 to 70 scams for every one legitimate work-from-home position. Anyone seeking telecommuting roles have to be vigilant in guarding against fraudulent opportunities,” says Sara Sutton Fell, founder and CEO of FlexJobs. According to a FlexJobs survey, 17% of job seekers have been a victim of a job scam at least once. Only 5% have never seen a scam.

[Related: Millionaire Mom of 6 Talks Birthing Business Breakthroughs]

Here are three opportunity scams you need to avoid:

Online Interview with a “Real” Company: Scammers use the names of real companies to lure unsuspecting job seekers online. Once they’re “hired,” people are either scammed by providing their private information (such as a Social Security number, bank account, or both).

Contact the company to ensure the job is legitimate, but don’t use the number the recruiter provides. Do a fresh Google search to find the company’s website, and then verify that company actually has a job opening for the position you’re applying for. Search for the job online. If the result comes up in other cities with the exact same job post, it’s likely a scam.

Multi-Level Marketing (MLM): The largest MLMs are household names: Avon, Mary Kay, Pampered Chef, and Amway that generate annual sales of about $30 billion with about 16 million people in the U.S. selling their products, reports the industry group Direct Selling Association. One big problem with MLMs is when ladder climbing is more important than selling actual product. If an MLM opportunity is all about finding new recruits rather than selling products or services, beware. The Federal Trade Commission says it a pyramid scheme.

If the company and its distributors make money primarily from the sale of products to end-users and not boxes of product accumulating in a distributor’s garage, it’s OK. By contrast, a pyramid scheme compensates those at the top of the pyramid with participation fees paid by those recruited at the bottom. It eventually collapses when the scheme can’t recruit more people.

Mystery Shopping: Some retailers hire companies that use mystery shoppers to evaluate the quality of service in their stores. They make purchases in a store or restaurant and then report on the experience. The shopper is reimbursed and can keep the product or service. Some also receive a payment. However, dishonest promoters use newspaper ads and e-mails to create the impression that mystery shopping is a gateway to a high-paying job with reputable companies. They create websites where you “register” to become a mystery shopper by paying a fee.

Becoming a mystery shopper for a legitimate company doesn’t cost anything. Check the Mystery Shopping Providers Association’s database to search mystery shopper assignments and learn how to apply for them. MSPA offers certification programs for a fee, but you don’t need “certification” to apply for assignments.

  • Katherine Ashby

    As a stay at home mom I recommend “Medical Coding and Billing” as a wonderful work from home option. Yes, you will need training. You can’t just code medical records without having proper training. However, this is a real and promising career. I used to work for “Career Step” and they have an awesome Medical Coding and Billing course.


    Their training is done online and is self-paced. You could finish the program in 4 months but 6 months is probably more realistic. They do however give you up to a year to get it all done. Their program is approved by the American Health Information Management Association and the American Academy of Professional Coders. They work specifically with a company called IOD inc. that hires their grads to work from home right out of the program.

    The average salary for this career is about $40,000. Their entire program including books, instructors and job assistance is around $3,000 and they offer sweet payment plans.

    Link to their free course demo: https://home.careerstep.com/?demo=PMCBDemouid=ref43233

    Just to give you an idea of how the online course is set up.

    If you want more info or have questions let me know @ katherine.b.ashby@gmail.com

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