Spotting Home Business Opportunity Scams

Desperate times mean that people are desperate.  And desperate times also bring out the people who prey on those desperate people.  Pyramid scheme offers are increasing, as Sandy Mitchell writes, even with the huge amount of publicity for the Bernard Madoff scam.  Work from home / home business opportunity scams are also coming out of the proverbial woodwork.  How do you know if the offer is legitimate or a scam?  The best people to ask are the folks at Undress4Success.com.  They have a great blog that helps you sort out the claims.

Undress4Success says you can spot a scam by looking at the ad carefully.  Look for these tell-tale signs:

- Unreasonable claims
- HUGE TYPE and lots of exclamation points!!!
- No company information
- 20 pages of hard sell blah, blah, blah
- Countdown timer urging you to “act now” and claims that “this may be the last day”

Note how these ads use some of the principles of Influence I have been talking about.  For example,  “act now,” “this may be the last day” = Principle of Scarcity . And testimonials to persuade you that others have benefitted so you can too = Social Proof.

Some other “red flags” are the requirement that you pay to join and to learn how to do the work (legitimate businesses pay you to learn) and the pay structure.  Pay should be easy to determine and verify. If there is no way to verify how your pay is being calculated, beware.

Check with trusted advisers, like your attorney and your banker to get their opinions.  Some other U.S. government websites you might find helpful:

• U.S. Postal Inspector (for mail fraud)
• Your state attorney general
• The Federal Trade Commission (consumer protection)
• The consumer protection agency or office of the state attorney general in your state

I’m not saying that there aren’t legitimate home business opportunities out there; there certainly are.  But I’m saying that you have to be careful.  Remember, if it seems too good to be true, it probably is.

Image source: sxc.hu