FTC FACTS for Consumers

FOR THE CONSUMER 1-877-FTC-HELP

ftc.gov FEDERAL TRADE COMMISSION

Work-at-Home Schemes

A ds like this are everywhere — from the telephone pole on the corner to your newspaper, email and favorite websites. The jobs might be different, but the message 

is the same — start earning a great living today working from home, even in your spare time.

When money’s tight, work-at-home opportunities can 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. 

The con artists peddling them may get you to pay for starter kits or certifications that are useless, 

and may even charge your credit card without permission. 

Others 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 they don’t disclose all the costs you might incur — say, for placing 

newspaper ads, making photocopies, or buying the envelopes, paper, stamps and other supplies 

you need to do the job. People tricked by these ads have lost thousands of dollars, not to mention 

time and energy.

Be part of one of America’s Fastest Growing Industries. 

Be the Boss!

Earn thousands of dollars a month from home!
Facts for Consumers

Here are some examples of work-at-home 

schemes to avoid:

Envelope Stuffing. For a “small” 

fee, the ad says, you’ll learn how 

to earn lots of money stuffing 

envelopes at home. But once you 

pay, you find out the promoter never 

had any work to offer. Instead, after 

you send in your money, you get a letter 

telling you to get other people, even your 

friends and relatives, to buy the same envelopestuffing “opportunity” or some other product. The 

only way you can earn any money is if people 

respond the same way you did. 

Assembly or Craft Work. According to the 

ad, you can make money assembling crafts or 

other products at home. You may have to invest 

hundreds of dollars for equipment or supplies — 

for example, a sewing or sign-making machine 

from the company, or materials 

to make items like aprons, baby 

shoes or plastic signs — or spend 

lots of hours producing goods 

for a company that has promised 

to buy them. 

But after you’ve paid money 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 without any 

income to show for it. 

Rebate Processing. The ad in your email 

says you can earn money by helping to process 

rebates. And the fee for training, certification or 

registration is nothing compared to what you’ll 

earn processing rebates from home, according 

to the promises in the ad. It says the #1 certified 

work-at-home consultant behind the program will 

show you how to succeed like she did. 

What you get are poorly written and useless 

training materials. There are no rebates to 

process, and few people ever see a refund.

Online Searches. The ad on the website piques 

your curiosity — earn $500 to $1000 a week, or 

even $7,000 a month, running Internet 

searches on prominent search engines 

and filling out forms. Even better, 

you can be your own boss and do 

the work right from home. What 

have you got to lose, except a small 

shipping and handling fee? 

Unfortunately, you have a lot to lose. 

The company isn’t really connected with a wellknown search engine — scammers are just lying 

to trick you into handing over your credit or debit 

card information. If you pay them even a tiny fee 

online, they can use your financial information to 

charge you recurring fees. 

Medical Billing. The ads lure you with promises 

of a substantial income for full- or part-time work 

processing medical claims electronically — no 

experience needed. When you call the toll-free 

number, a sales rep tells you doctors are eager 

for help, and in exchange for your investment of 

hundreds — or thousands — of dollars, 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 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 may not even 

work. Competition in the medical billing market 

is fierce, and not many people who purchase 

these “opportunities” are able to find clients, start 

a business or generate revenue — let alone get 

back their investment and earn any income. Many 

doctors’ offices process their own medical claims, 

and doctors who contract out their billing function 

often use large, well-established firms, rather than 

someone working from home. 

To avoid a medical-billing scam, ask for a sizable 
Facts for Consumers

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list of previous purchasers so you can pick and 

choose whom to contact for references. If the 

promoter gives only one or two names, consider 

that they may be “shills” hired to say good 

things. Try to interview people in person where 

the business operates. Talk to organizations for 

medical claims processors or medical billing 

businesses and to doctors in your community 

about the field. Finally, consult an attorney, 

accountant or other business advisor before you 

sign an agreement or make any payments up 

front. 

When it comes to business opportunities, there are 

no sure bets. Promises of a big income for work 

from home, especially when the “opportunity” 

involves an up-front fee or divulging 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. The 

situation demands both research and skepticism.

Ask Questions

Here are some questions to ask: 

•	 What tasks will I have to perform? (Ask the 

program sponsor to list every step of the 

job.) 

•	 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? 

•	 Who will pay me? 

•	 When will I get my first paycheck? 

•	 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-athome program is legitimate, 

and if so, whether it’s a good 

fit for you. 

You’ll also want to check out 

the company with your local 

consumer protection agency, 

state Attorney General and 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 be 

wary: just because there aren’t complaints doesn’t 

mean the company is legitimate. Unscrupulous 

companies may settle complaints, change their 

names or move to avoid detection. 

In addition, consider other people’s experience by 

entering the company or promoter’s name with 

the word complaints into a search engine. Read 

what others have to say. After all, you are making 

a decision that involves spending your money.

Where to Complain

If you have spent money and time on a work-athome program and now believe the program may 

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 these 

organizations: 

•	 The Federal Trade Commission 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. Visit 

naag.org; the office will be able to tell you 

whether you’re protected by any state law 

that may regulate work-at-home programs. 
Facts for Consumers

1-877-FTC-HELP FOR THE CONSUMER

FEDERAL TRADE COMMISSION ftc.gov

February 2010

Federal Trade Commission

Bureau of Consumer Protection

Division of Consumer and Business Education

•	 Your local consumer protection offices. 

•	 Your local Better Business Bureau at bbb.org. 

•	 Your local postmaster. The U.S. Postal 

Service investigates fraudulent mail practices. 

Visit postalinspectors.uspis.gov.

•	 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 new video, How to File a Complaint, 

at ftc.gov/video 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.