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Work-at-Home Schemes

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What is a Work-at-Home Scheme?

Many ads in newspapers offer people a chance to earn a lot of money at home in their leisure time.  Many will promise large profits in short periods of time.  However, you should be cautious of such ads.  Some offers are legitimate, but many are not.  These types of schemes are a type of classified advertising fraud.   

What Should I Look Out For?

Many of these classified ads do not tell the whole story.  For example, you should be careful because:

  • You may have to work many hours without pay
  • There may be hidden costs
  • You may have to spend your own money (e.g., placing ads, buying supplies and equipment)
  • You may have to pay a membership fee or make regular payments to the company

What are Some Common Schemes?

There are some common work-at-home schemes, including:

  • Envelope-stuffing : This is the most common type of scheme.  You may be asked to pay a "small" fee in exchange for information on how to earn money stuffing envelopes.
  • Assembly or craft work : You may be required to invest a lot of money in equipment or supply.  You may also be required to invest many hours of your time to produce goods for a company who has promised to buy them.  However, after you have invested your money or time, the company refuses to pay for the work because it does not meet "quality standards."

What Precautions Can I Take?

You should find out as much as you can about the company.  For instance, you should ask the employer:

  • What tasks are you required to perform?
  • Will you be paid on salary or commission?  Who will pay you?
  • When will you get your first paycheck?
  • What is the total cost of the program?

You can also check with the consumer protection agency or the Better Business Bureau in the area where the company is located. 

What Should I Do if I Believe I Am a Victim of a Work-at-Home Scheme?

First, you should contact the company and attempt to get your money back.  Inform them that you plan to notify officials.  You may also get assistance from:

  • Attorney General's office of your state or the company's state
  • Local consumer protection offices
  • Local Better Business Bureau
  • Local Postmaster
  • Advertising manager of the publication that ran the ad
  • The Federal Trade Commission (FTC)

Do I Need a Lawyer if I am a Victim of a Work-at-Home Scheme?

An experienced lawyer can help you determine whether you have a claim.  Consulting a lawyer also can help you recognize whether you have been defrauded and whether pursuing legal action would be beneficial.

Photo of page author Ken LaMance

, LegalMatch Law Library Managing Editor and Attorney at Law

Last Modified: 02-06-2013 04:30 PM PST

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