FTC shuts down several work at home scam companies

Work from home – legit or not?

Many companies, particularly tech startups, have work from home programs, wherein employees can spend all or part of their time outside of the office, and it is an increasingly popular work option. There are also jobs, again, primarily in tech, where skilled workers can earn $40 and hour.

But people continue to fall for the work at home scheme that promises them $79 and hour just for sitting at their computer, no skill required, no real work required, just breathe and be rewarded, just have $40 in your bank account and give them access to your financials, no biggie. No job that pays that well comes searching for low-level employees – they don’t need to. Well paying jobs are available for qualified candidates who reach out to the recruiting company and jump through the hoops.

Regardless of how obvious some of the scams are to you and me, many people do fall victim to the work at home scheme, so the U.S. Federal Trade Commission (FTC) has shuttered several of the scams in an effort to protect consumers.

These are straight up scams

In a 2012 FTC complaint, several businesses offering “mystery shopper” jobs and other “business opportunities” were actually scams to trick consumers into joining programs that required recurring monthly charges, despite that being unclear at the onset.

This week, the Commission has settled with several of the companies and individuals named in the complaint, including Shopper Systems LLC, Revenue Works LLC (also known as “Surplus Supplier”), EMZ Ventures LLC, The Veracity Group LP, Brett Brosseau, Michael Moysich, and Keith R. Powell.

These companies will never pony up

The total sum of the settlements is over $55.3 million, and all parties are now banned from selling “business or work-at-home opportunities,” and most are now prohibited from sending unsolicited text messages.

The FTC acknowledges that it is likely that less than $500,000 will ever be paid, as the scammers have already had their assets frozen, liquidated, or surrendered, and many of the companies are now defunct.

Three outcomes of this settlement

We suspect three outcomes: (1) going forward, the CFPB (Consumer Finance Protection Bureau) will handle these types of scams, and they’re not playing around, (2) these scammers will resurrect themselves and do something unrelated like vitamin sales or whatnot, and (3) the settlement will not raise awareness of the potential victims, rather of those around them with common sense enough to know that there is no such thing as a free lunch.

Note: About.com’s Alison Doyle has complied a useful guide to spotting and avoiding work at home scams.