Work-at-Home 

Businesses

Federal Trade Commission | consumer.ftc.gov

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Want to be your own boss? Earn thousands of dollars a month from home? Ads promote 

many different work-at-home jobs and businesses, 

but often the message is the same: they promise 

you’ll earn a great living from home, even in your 

spare time. 

Don’t take their word for it — many of these “jobs” 

are scams, or don’t deliver on the claims they make. 

So do some research, and learn about common 

work-at-home scams.

What to Know About 

Work-at-Home Businesses

When money’s tight, a work-at-home opportunity 

might sound like just the thing to make ends meet. 

Some even promise a refund if you don’t succeed. 

But the reality is many of these jobs are scams. You 

end up paying for starter kits or certifications that are 

useless, find your credit card is charged without your 

permission, or get caught up in a fake check scam. 

Other work-at-home offers just don’t deliver on their 

promises. The ads don’t tell you that you may have 

to work a lot of hours without pay, or don’t disclose 

all the costs up-front. You might spend money based 

on promises you’ll quickly earn it back — but you 

don’t. People tricked by work-at-home ads have lost 

thousands of dollars, not to mention their time and 

energy.
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Common Work-at-Home Scams

Internet businesses

You’re told you can earn thousands of dollars a month 

starting your own internet business. The company 

says that no experience is necessary because they 

have experts to coach you, and you’re pressured to 

pay for the opportunity right away. Once you pay, the 

company says you won’t succeed unless you pay for 

more pricey services. Many people who pay for these 

“businesses” are left with a lot of debt and not much 

else. 

Other work-at-home offers tell you that you can make 

money doing tasks like internet searches on prominent 

search engines and filling out forms. You just have to 

pay a small shipping and handling fee. Later on, you 

learn that the company isn’t connected with a wellknown search engine like it claims — scammers are 

just lying to get your credit or debit card information. 

If you pay them even a tiny fee online, they can use 

your financial information to put additional charges on 

your card.

Envelope stuffing

For a small fee, the ad says, you’ll make lots of money 

stuffing envelopes. But after you pay, you find out 

there is no work. Instead, you get a letter telling you 

to get other people to buy the same envelope-stuffing 

opportunity or some other product. You earn money 

only if those people respond the same way you did.
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Assembly or craft work

You see an ad that says you can make money 

assembling crafts or other products at home for a 

company that has promised to buy them. You may 

have to invest hundreds of dollars for equipment or 

supplies — like a sewing or sign-making machine 

from the company, or materials to make items like 

aprons, baby shoes, or plastic signs. Then you spend 

many hours making the “product.” But after you’ve 

bought your supplies and done the work, the company 

doesn’t pay you — supposedly because your work 

isn’t “up to standard.” Unfortunately, no work ever is, 

and you’re left with equipment and supplies, but no 

income.

Rebate processing

The ad says you can earn money by helping to 

process rebates. The fee for training, certification, or 

registration is nothing compared to what you’ll earn, 

the ad promises. The “#1 certified work-at-home 

consultant” behind the program will show you how to 

succeed like she did. What you get instead are poorly 

written and useless training materials. There are no 

rebates to process, and few people ever get a refund.

Medical billing

The ads promise a substantial income for full- or parttime work processing medical claims electronically 

— no experience needed. When you call the toll-free 

number, a sales rep tells you doctors are eager for 
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help. In exchange for your investment of hundreds 

— or thousands — of dollars, the rep says, you’ll 

get everything you need to launch your own medical 

billing business, including the software to process the 

claims, a list of potential clients, and technical support. 

But the companies rarely provide experienced sales 

staff or contacts in the medical community. The lists 

they give you often are out-of-date and include doctors 

who haven’t asked for billing services. The software 

they send might not even work. Competition in the 

medical billing market is fierce, and few people who 

make the investment are able to find clients or generate 

any income — let alone get back their investment. 

Mystery shopping 

Ads for mystery shoppers say they want people who 

are willing to shop at certain stores or dine at certain 

restaurants, and then report on their experience in 

exchange for money. While there are some legitimate 

mystery shopping jobs, many are scams. Scammers 

might tell you that you need to pay for worthless 

certifications, directories, or job guarantees. Others are 

running fake check scams — they ask you to deposit 

checks and wire some of the money back, before you 

and the bank find out the check is fake, and you’re 

responsible for paying it back. You should never have 

to pay to get into the mystery shopping business. 
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Multilevel marketing

Another type of work-at-home opportunity is a 

multilevel marketing (MLM) plan. In multilevel or 

network marketing, you’re supposed to sell products 

to the public — often by word of mouth and direct 

sales. In legitimate MLM opportunities, you’ll earn 

commissions for the products you sell, and for sales 

made by people you recruit.

But not all multilevel marketing plans are legitimate. 

Some MLM companies tout luxurious lifestyles and 

suggest you’ll earn enough money to quit your job 

or meaningfully supplement your income. But are 

their claims for real? Be wary and ask for written 

information about how much money most people 

make (after deducting their expenses). Also, if anyone 

suggests recruiting is the real way to make money, 

know this: MLMs that survive on recruiting new 

participants rather than retail sales are pyramid 

schemes. Pyramid schemes are illegal, and the vast 

majority of participants lose money.

How to Know If It’s a Scam 

Promises of a big income working from home, 

especially when the “opportunity” involves an up-front 

fee or giving your credit card information, should 

make you very suspicious. It doesn’t matter if the ad 

shows up in a trusted newspaper or website, or if the 

people you talk to on the phone sound legitimate. It 

still could be a scam.
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If you’re thinking about following up on a workat-home offer, do your homework. The FTC’s 

Business Opportunity Rule has safeguards in place 

to make sure you have the information you need to 

tell whether a work-at-home opportunity is a risky 

business. Under the Rule, sellers have to give you a 

one-page disclosure document that offers key pieces of 

information about the opportunity. Use the information 

in the disclosure document to fact-check what the 

seller tells you. In addition to reviewing the disclosure 

document, here are some questions to ask:

● What tasks will I have to perform? Are any other 

steps involved?

● Will I be paid a salary, or will I be paid on 

commission?

● What is the basis for your claims about my 

likely earnings? Do you survey everyone who 

purchased the program? What documents can 

you show me to prove your claims are true 

before I give you any money? Note: If a seller 

makes a claim about how much money a person 

can earn, the seller also has to give you an 

earnings claim statement with more specifics.

● Who will pay me?

● When will I get my first paycheck?
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● What is the total cost of this work-at-home 

program, including supplies, equipment, and 

membership fees? What will I get for my money?

The answers to these questions may help you 

determine whether a work-at-home program is 

legitimate, and if so, whether it’s a good fit for you. 

Check them out

It’s a good idea to research other people’s experience. 

Try entering the company or promoter’s name with the 

words “complaint,” “reviews,” or “scam” into a search 

engine. Read what others have to say. After all, it’s 

your money on the line.

You also might try checking out a company with your 

local consumer protection agency, your state Attorney 

General, or the Better Business Bureau — not only 

where the company is located, but also where you 

live. These organizations can tell you whether they’ve 

gotten complaints about a particular work-at-home 

program. But remember: just because there aren’t 

complaints doesn’t mean the company is legitimate. 

Dishonest companies sometimes settle complaints and 

change their names or move to avoid detection.
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Report a Scam

If you have spent money and time on a work-at-home 

program and now believe it might not be legitimate, 

contact the company and ask for a refund. Let 

company representatives know that you plan to notify 

law enforcement officials about your experience. If 

you can’t resolve the dispute with the company, file a 

complaint with:

● The FTC at ftc.gov/complaint or 

1-877-FTC-HELP (1-877-382-4357).

● The Attorney General’s office in your state or the 

state where the company is located. Find yours 

at naag.org. The office can tell you if you’re 

protected by a state law that regulates work-athome programs.

● The advertising manager of the publication that 

ran the ad. The manager may be interested to 

learn about the problems you’ve had with the 

company.
For More Information

The FTC works to prevent fraudulent, deceptive 

and unfair business practices in the marketplace 

and to provide information to help consumers spot, 

stop and avoid them. To file a complaint or get free 

information on consumer issues, visit ftc.gov or call 

toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 

1-866-653-4261. 

Watch a video, How to File a Complaint, at 

consumer.ftc.gov/media to learn more. The FTC 

enters consumer complaints into the Consumer 

Sentinel Network, a secure online database and 

investigative tool used by hundreds of civil and 

criminal law enforcement agencies in the U.S. and 

abroad. 
Federal Trade Commission

consumer.ftc.gov

April 2015