The Federal Trade Commission (FTC) has launched a new crackdown on con artists who are preying on unemployed Americans.
The fraudsters utilize job-placement and work-at-home scams, promoting empty promises that they can help people get jobs in the federal government, as movie extras, or as mystery shoppers; or make money working from their homes stuffing envelopes or assembling ornaments.
As part of the law enforcement sweep, dubbed "Operation Bottom Dollar," the FTC has filed seven cases against the operators of deceptive and illegal job and moneymaking scams. In addition, the sweep includes 43 criminal actions by the Department of Justice, many involving the substantial assistance of the U.S. Postal Inspection Service.
The agency also announced partnerships with the online job placement service Monster.com, the search engine Bing and the centralized network of online communities Craigslist to help job seekers recognize job scams so they can avoid being victimized. Monster, Careerbuilder, Bing and Craigslist will display FTC consumer education material to people who are using the companies' Web sites to look for jobs.
"Federal and state law enforcement officials will not tolerate those who take advantage of consumers in times of economic misfortune," said David C. Vladeck, Director of the FTC's Bureau of Consumer Protection. "If you falsely advertise that you will connect people with jobs or with opportunities for them to make money working from home, we will shut you down. We will give your assets to the people you scammed, and, when it's appropriate, we'll refer you to criminal authorities for prosecution."
To help consumers avoid being conned by employment scams, the FTC has produced a new consumer education video in English and Spanish.
FTC Law Enforcement Actions
The FTC announced seven new cases against promoters of the job and moneymaking scams, including one that victimized more than 100,000 people. This brings to eleven the number of cases the agency has brought since last spring challenging these types of operations. In these latest actions, the FTC charged that:
Government Careers Inc. and three principals preyed on job seekers since at least March 2009 by running deceptive ads on job Web sites. Government Careers claimed it could help people get postal, border patrol, and wildlife jobs as well as administrative support and clerical positions with the federal government.
Real Wealth, Inc. and its principal allegedly conned more than 100,000 people by selling them booklets that supposedly explained how they could earn money by applying for government grants and working from home mailing postcards and envelopes.
Darling Angel Pin Creations and two principals allegedly claimed on the Internet and in newspaper advertisements that by purchasing a starter kit, consumers could earn up to $500 per week assembling angel pins, and that no experience, special tools, or sewing skills were required. Consumers paid between $22 and $45 to get started, and sometimes paid hundreds more for the supplies they would need to make the pins.
Abili-Staff, Ltd., two principals, and a related entity sold supposed work-at-home opportunities online. Billing itself as a "scam free" and "legitimate" job search service, Abili-Staff sold supposedly pre-screened lists of jobs, telling consumers they could access the lists after paying a fee ranging from $29.98 to $89.99, according to the FTC's complaint.
Entertainment Work, Inc. and two principals marketed memberships in a Web site that was supposed to list jobs as movie extras, jobs on television, or jobs in print media. By telemarketing and placing advertisements on Web sites and in newspapers across the country, the defendants sold trial memberships for $19.95 to $24.95, and automatically converted those into annual memberships for an additional fee of $80 after two weeks, according to the FTC complaint.
Independent Marketing Exchange, Inc. and its principal allegedly made false earnings claims, and additional misrepresentations in the course of selling a smorgasbord of work-at-home opportunities, including an envelope mailing opportunity, a postcard mailing opportunity, and a mystery shopper opportunity. Their deceptive practices have injured numerous consumers, including stay-at-home and single mothers.
Preferred Platinum Services Network and the husband-and-wife team who owned and operated it allegedly marketed a work-from-home scheme in which consumers were told they could earn significant sums by labeling postcards describing a non-existent product promoted by Preferred Platinum called "mortgage accelerator." Advertised in local pennysavers and newspaper classified sections, and at the defendants' Web site, the scheme touted earnings of up to $1 per postcard, as well as a 60-day money-back guarantee.
Thousands of consumers get stung by schemes such as these.
Sharon of New Bern, NC, tells ConsumerAffairs.com of an ad that she says was on AOL's home page about a company that was hiring workers to work at home. "It talked about the company and the start up rate ($1.95) I clicked the link to go to the website, and it said the cost and what you are expected to get for $1.95 It doesn't say anything about any other costs at all."
Sharon says her account was debited the $1.95, but, "days later I was billed $129.00. I tried contacting the company by sending an email, and the email came back. It was undeliverable. There is no phone number on the website. I later found out through their Terms and Services (on the bottom of the website) that you have to cancel within 3 days. That's why I was billed."
"Purchased a product for work at home opportunity," writes Sandra of Indiana. "Was promised that this purchase would include medical billing software and names of (2) doctors that I would do medical billing for from my home. Was promised that the purchase would be delivered in 48 hours. Product was not delivered until 8 days after purchase and did not include what was promised. I have made several attempts to contact the company leaving numerous messages and have never received a call back. I paid $399 for the product and did not get what was promised."
The tough economy has helped the "work at home scams" proliferate. Your best protection against them is to know the warning signs so you can avoid being taken.