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Working at home may seem like a good way to earn some extra cash in your spare time, but be careful.  While legitimate opportunities exist, many work-at-home opportunities are actually scams that are actually growing in number with the spread of the Internet and email. Even though the scammers may be using modern technology the basic scam hasn't changed much, and their targets – senior citizens, stay-at-home parents, the disabled, and the unemployed – are those who can least afford to be taken in by their false claims.

There are several red flags that can alert you to a phony work-at-home scam.  They include:

Simply put, if anything sounds too good to be true…
it probably is.

Common Scams
Some of the most common work-at-home scams include:

Envelope Stuffing – This scheme doesn’t provide you with envelopes to stuff, but offer to sell you materials that tell you how you can make money selling the same scam to others!  Most “envelope stuffing” is done by direct mail marketing companies with sophisticated equipment, not individualsClick here to listen!working at their kitchen table.

Assembly Work – Again, you are required to buy the raw materials to make items (such as toys, or signs) for a company that then promises to buy them from you.  Unfortunately after you buy the material and put it together the company refuses to buy the finished product claiming it is below their standards.  You’ve lost your investment and are stuck with a basement full of junk.

Processing Medical Claims – This scheme involves purchasing software, and sometimes even computers, usually at inflated prices.  You will probably also have to buy training sessions.  Often these scams are sold by high pressure salespeople at trade shows.  Though you are told you will be working for insurance companies, often this is a hollow promise and you may find that the market for your service doesn’t exist.

Multi-Level Marketing – There are many reputable companies that use direct sales and multi-level marketing in legitimate ways.  Unfortunately there are also many illegitimate companies that deceive victims into entering into pyramid type operations.  A good warning sign is if the company emphasizes recruiting new people to join the program, rather than selling their products.  This sort of operation, much like a chain letter, will soon run out of new victims, leaving those at the bottom poorer for the experience.

On-Line Opportunities – This scam promises that you will be able to make piles of cash using your home computer.  Not surprisingly, these offers are often found on-line, in spam email, or in annoying pop-up ads.  What they’re selling you is a worthless list or CD of “opportunities.”  These jobs are often just a rehash of the scams listed above like envelope stuffing, medical processing, assembly work, though may also include word processing and other computer work.  Like most work-at-home scams their long on promises but woefully short on results or real help.

Avoiding Scams

Remember: if it sounds too good to be true, you’re probably looking at a scam.  If you have to buy books, software, materials, sales kits, or anything before you can start, it’s probably a scam.  Even if an opportunity looks legitimate, do your homework: ask for references; call the Better Business Bureau, in short check out any company before you given them your hard earned money.  Work-at-home scams can be a waste of your time and money, but they can also be illegal.  Those scams which expect you to duplicate the scammers behavior (such as envelope stuffing or multi-level marketing pyramids) could be leave you open to the charge of perpetuating the fraud…so be careful!

As with any business venture, follow the rules of basic common sense:

If you do fall victim to a work-at-home scam notify your local law enforcement officials.  Make sure you have copies of all your receipts and letter with the scammers, as well as a record of all your communications.  You can also contact your state’s office of the attorney general,  your state’s consumer affairs division, and the Better Business Bureau.