Work-at-Home Scams

While you may find "work at home" ads appealing, especially if you can't work outside your home, proceed with caution. Not all work-at-home opportunities deliver on their promises.

Many ads omit the fact that you may have to work many hours without pay. Or they don't disclose all the costs you will have to pay. Countless work-at-home schemes require you to spend your own money to place newspaper ads; make photocopies; or buy the envelopes, paper, stamps, and other supplies or equipment you need to do the job. The companies sponsoring the ads also may demand that you pay for instructions or "tutorial" software. Consumers deceived by these ads have lost thousands of dollars, in addition to their time and energy.

Classic Work-at-Home Schemes

Several types of offers are classic work-at-home schemes:

Medical billing

Ads for pre-packaged businesses - known as billing centers - are in newspapers, on television and on the Internet. The promoter may tell you that many doctors who process claims electronically want to "outsource" or contract out their billing services to save money. Promoters will promise that you can earn a substantial income working full or part time, providing services like billing, accounts receivable, electronic insurance claim processing and practice management to doctors and dentists. The reality: you will have to sell. These promoters rarely provide experienced sales staff or contacts within the medical community.

Few consumers who purchase a medical billing business opportunity are able to find clients, start a business and generate revenues - let alone recover their investment and earn a substantial income. Competition in the medical billing market is fierce and revolves around a number of large and well-established firms.

Envelope stuffing

Promoters usually advertise that, for a "small" fee, they will tell you how to earn money stuffing envelopes at home. Later - when it's too late - you find out that the promoter never had any employment to offer. Instead, for your fee, you're likely to get a letter telling you to place the same "envelope-stuffing" ad in newspapers or magazines, or to send the ad to friends and relatives.

Assembly or Craft Work

These programs often require you to invest hundreds of dollars in equipment or supplies. But after you've purchased the supplies or equipment and performed the work, fraudulent operators don't pay you.

Questions to Ask

Legitimate work-at-home program sponsors should tell you - in writing - what's involved in the program they are selling. Here are some questions you might ask a promoter:

• What tasks will I have to perform? (Ask the program sponsor to list every step of the job.)
• Will I be paid a salary or will my pay be based on commission?
• Who will pay me?
• When will I get my first paycheck?
• What is the total cost of the work-at-home program, including supplies, equipment and membership fees? What will I get for my money?

You also might want to check out the company with your local consumer protection agency, state Attorney General and the Better Business Bureau, not only where the company is located, but also where you live.

Where to Complain

If you have spent money and time on a work-at-home program and now believe the program may not be legitimate, contact the company and ask for a refund. Let company representatives know that you plan to notify officials about your experience.

If you can't resolve the dispute with the company, file a complaint with:

• the Federal Trade Commission Consumer Response Center toll-free at 1-877-FTC-HELP (382-4357)or fill out the Federal Trade Commission Consumer Complaint Form online
• The Attorney General's office in your state or the state where the company is located
• Your local consumer protection offices
• Your local Better Business Bureau
• Your local postmaster (the U.S. Postal Service investigates fraudulent mail practices)
• The advertising manager of the publication that ran the ad

General Consumer Rights Message Board for more help