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Small Business Resources > Work From Home Scams

Work From Home Scams

How do you know if a work at home business is a scam or not? Well, there are many ways to tell if it warrants further investigation.

For starters, keep an eye out for red flags. If it sounds too good to be true, it probably is. If a business promises instant wealth with little effort, it is most definitely a scam. Avoid home-based businesses that say you have to pay for an information kit or a list of work at home opportunities. When you work for someone, even from home, you get paid; you are not the one paying. If you receive an unsolicited email, it is probably best to disregard it as those usually turn out to be fraudulent.

Running a legitimate home-based business requires a lot of effort, skill, time, and of course a marketable product or service, just like operating a business outside of your home. If you think an opportunity might be legit, here are a few options on how to find out.

You may wish to start with checking the company out with the Better Business Bureau, the Federal Trade Commission, and But don�t stop there even if you don�t find any complaints. If the company is willing to provide you with references go ahead and check on those; if they are not willing to comply with your request for references, they are probably not on the up and up. And of course, the company should be able to provide you with information on exactly what you will be doing for them and what resources (equipment, etc.) you will need to perform the duties.

In addition, it is important to find out the legal requirements necessary to perform the work, such as licensing needed. Also, some types of work cannot be performed at home per federal law. Check with the Department of Labor.

Additionally, it is necessary to find out if there is in fact a market for the work you will be doing. For example if you are told there are customers waiting for you to do medical billing for them, ask the company who the customers are and check with them to see if that is indeed true, especially within your local area. That is if the company will provide you with some of the names of customers. If not, you�ll know to stop your investigation.

Furthermore, there are a number of work at home scams to avoid right off the bat. They include assembly jobs, data entry jobs, multi-level marketing (MLM) listings, online businesses, jobs posting ads, claims processing, and envelope stuffing.

Finally, stay alert; scammers are always coming up with new twists on their advertising. If you have any suspicions at all, it is probably best to steer clear and check out another types of home based businesses.

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