1. Business opportunities
These business opportunities make it sound easy to start a
business that will bring lots of income without much work or cash outlay. The
solicitations trumpet unbelievable earnings claims of $140 a day, $1,000 a day,
or more, and claim that the business doesn't involve selling, meetings, or
personal contact with others, or that someone else will do all the work. Many
business opportunity solicitations claim to offer a way to make money in an
Internet-related business. Short on details but long on promises, these messages
usually offer a telephone number to call for more information. In many cases,
you'll be told to leave your name and telephone number so that a salesperson can
call you back with the sales pitch.
The scam: Many of these are illegal pyramid schemes masquerading
as legitimate opportunities to earn money.
2. Bulk email
Bulk email solicitations offer to sell you lists of email
addresses, by the millions, to which you can send your own bulk solicitations.
Some offer software that automates the sending of email messages to thousands or
millions of recipients. Others offer the service of sending bulk email
solicitations on your behalf. Some of these offers say, or imply, that you can
make a lot of money using this marketing method.
The problem: Sending bulk email violates the terms of service of
most Internet service providers. If you use one of the automated email programs,
your ISP may shut you down. In addition, inserting a false return address into
your solicitations, as some of the automated programs allow you to do, may land
you in legal hot water with the owner of the address's domain name. Several
states have laws regulating the sending of unsolicited commercial email, which
you may unwittingly violate by sending bulk email. Few legitimate businesses, if
any, engage in bulk email marketing for fear of offending potential customers.
3. Chain letters
You're asked to send a small amount of money ($5 to $20) to
each of four or five names on a list, replace one of the names on the list
with your
own, and then forward the revised message via bulk email. The letter may
claim that the scheme is legal, that it's been reviewed or approved by the
government;
or it may refer to sections of law that legitimize the scheme. Don't
believe it.
The scam: Chain letters-traditional
or high-tech-are almost always illegal, and nearly all of the people who
participate in them lose their money.
The fact that a "product" such as a report on how to make money fast, a mailing
list, or a recipe may be changing hands in the transaction does not change
the
legality of these schemes.
4. Work-at-home schemes
Envelope-stuffing solicitations promise steady income for minimal
labor-for example, you'll earn $2 each time you fold a brochure and seal it in
an envelope. Craft assembly work schemes often require an investment of hundreds
of dollars in equipment or supplies, and many hours of your time producing goods
for a company that has promised to buy them.
The scam: You'll pay a small fee to
get started in the envelope-stuffing business. Then, you'll learn that
the email sender never had
real employment to offer. Instead, you'll get instructions on how to send
the same envelope-stuffing ad in your own bulk emailings. If you earn any
money, it
will be from others who fall for the scheme you're perpetuating. And after
spending the money and putting in the time on the craft assembly work,
you are
likely to find promoters who refuse to pay you, claiming that your work isn't
up to their "quality standards."
5. Health and diet scams
Pills that let you lose weight without exercising or changing your
diet, herbal formulas that liquefy your fat cells so that they are absorbed by
your body, and cures for impotence and hair loss are among the scams flooding
email boxes.
The scam: These gimmicks don't work.
The fact is that successful weight loss requires a reduction in calories
and an increase in physical
activity. Beware of case histories from "cured" consumers claiming amazing
results; testimonials from "famous" medical experts you've never heard of;
claims that the product is available from only one source or for a limited time;
and ads that use phrases like "scientific breakthrough," "miraculous cure,"
"exclusive product," "secret formula," and "ancient ingredient."
6. Effortless income
The trendiest get-rich-quick schemes offer unlimited profits
exchanging money on world currency markets; newsletters describing a variety of
easy-money opportunities; the perfect sales letter; and the secret to making
$4,000 in one day.
The scam: If these systems worked, wouldn't everyone be using
them? The thought of easy money may be appealing, but success generally requires
hard work.
7. Free goods
Some email messages offer valuable goods-for example, computers,
other electronic items, and long-distance phone cards-for free. You're asked to
pay a fee to join a club, then told that to earn the offered goods, you have to
bring in a certain number of participants. You're paying for the right to earn
income by recruiting other participants, but your payoff is in goods, not money.
The scam: Most of these messages are covering up pyramid schemes,
operations that inevitably collapse. Almost all of the payoff goes to the
promoters and little or none to consumers who pay to participate.
8. Investment opportunities
Investment schemes promise outrageously high rates of return with
no risk. One version seeks investors to help form an offshore bank. Others are
vague about the nature of the investment, stressing the rates of return. Many
are Ponzi schemes, in which early investors are paid off with money contributed
by later investors. This makes the early investors believe that the system
actually works, and encourages them to invest even more.
Promoters of fraudulent investments often operate a particular
scam for a short time, quickly spend the money they take in, then close down
before they can be detected. Often, they reopen under another name, selling
another investment scam. In their sales pitch, they'll say that they have
high-level financial connections; that they're privy to inside information; that
they'll guarantee the investment; or that they'll buy back the investment after
a certain time. To close the deal, they often serve up phony statistics,
misrepresent the significance of a current event, or stress the unique quality
of their offering-anything to deter you from verifying their story.
The scam: Ponzi schemes eventually collapse because there isn't
enough money coming in to continue simulating earnings. Other schemes are a good
investment for the promoters, but no for participants.
9. Cable descrambler kits
For a small sum of money, you can buy a kit to assemble a cable
descrambler that supposedly allows you to receive cable television transmissions
without paying any subscription fee.
The scam: The device that you build
probably won't work. Most of the cable TV systems use technology that these
devices can't crack.
What's more, even if it worked, stealing service from a cable television
company is illegal.
10. Guaranteed loans or credit, on easy terms
Some email messages offer home-equity loans that don't require
equity in your home, as well as solicitations for guaranteed, unsecured credit
cards, regardless of your credit history. Usually, these are said to be offered
by offshore banks. Sometimes they are combined with pyramid schemes, which offer
you an opportunity to make money by attracting new participants to the scheme.
The scams: The home equity loans turn out to be useless lists of
lenders who will turn you down if you don't meet their qualifications. The
promised credit cards never come through, and the pyramid money-making schemes
always collapse.
11. Credit repair
Credit repair scams offer to erase accurate negative information
from your credit file so you can qualify for a credit card, auto loan, home
mortgage, or a job.
The scam: The scam artists who promote
these services can't deliver. Only time, a deliberate effort, and a personal
debt repayment plan will
improve your credit. The companies that advertise credit repair services
appeal to consumers with poor credit histories. Not only can't they provide
you with a
clean credit record, but they also may be encouraging you to violate federal
law. If you follow their advice
you may be committing fraud.
12. Vacation prize promotions
Electronic
certificates congratulating you on "winning" a fabulous
vacation for a very attractive price are among the scams arriving in your email.
Some say you have been "specially selected" for this opportunity.
The scam: Most unsolicited commercial email goes to thousands or
millions of recipients at a time. Often, the cruise ship you're booked on may
look more like a tug boat. The hotel accommodations likely are shabby, and you
may be required to pay more for an upgrade. Scheduling the vacation at the time
you want it also may require an additional fee.
It's not always easy to spot scams, and new
ones are invented every day. If you suspect that you
may be a target of fraud, or if you have already sent
funds, don't be embarrassed - you're not alone. If
you want to report a fraud, or if you need more information,
contact PhoneBusters:
Email
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