How To Avoid Scams and Report Fraud

How To Avoid Scams and Report Fraud

How can you avoid home business scams and what should you do if you believe you are the victim of fraudulent activity?

Question from HBT reader: I’ve sent money to a company for a home business job package. It’s been over 3 weeks and I still haven’t received the package, and now I can’t get ahold of them. What should I do?


These tips will help you avoid being the victim of a scam. If you find yourself in the unfortunate position of losing money to a company involved in fraudulent business activities follow the links provided to report the offending party.

1. Check for complaints filed against a company with the Better Business Bureau. This is a good first step to research the manner in which a company does business with its customers and clients. You should also check fraud listings ScamBusters and Ripoff Report.  You can avoid wasting your time on a bad opportunity, not to mention your money, by doing this research right up front.

2. Be extremely cautious of anyone asking you to send money. If someone is asking you to send in money then they are NOT offering a job. They are offering an opportunity, which is not the same thing. Employers pay employees, not the other way around. Work-at-home scams are often presented to appear as if you are being offered a job, since people are more trusting of job offerings as opposed to a simple opportunity.

3. You should be able to get complete disclosure about an opportunity before sending money. All your questions should be answered in full. Many home business scams are designed to persuade you to sign up immediately before the questions you should be asking are not apparent to you. Take your time. Be leery of promises of big money. If it sounds too good to be true, then err on the side of caution and assume it’s not true.

4. If you decide an opportunity is worth paying for, always use a credit card. It’s nearly impossible to get a refund from a company or person with fraudulent intentions, but with a credit card you can dispute charges.

5. Make sure you can communicate easily with the company offering the home business opportunity. They should have a phone number available for inquiries, and at the very least an email address with reasonably fast response times. They should also have a physical address and not just a post office box or suite number.

6. Investigate the opportunity by talking to people who have experience working with the company. Find out if their experience is favorable. Be suspicious of any company that does not provide you with references. Never take on faith any claims made by the company. If you feel yourself being pulled into a trusting frame of mind, recall the indictment Ronald Reagan loved to intone: “Trust, then verify.”

7. If you find yourself the victim of a home business scam, you should ask the business for a refund. If they are resistant to returning your money, inform them of your intention to notify the authorities. If you are lucky enough to get your money back, you should still report the fraudulent practices of the offending company to the following entities:

Brett Krkosska provides how-to advice on small business and home-based work issues. He is the founder of HomeBizTools and the publisher of Straight Talk, a syndicated column that offers a unique perspective on today’s business issues.

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