New Rules by the FTC for Work at Home Scam

Work at home scams have been growing over the last few years due to the economic hard times. More individuals are now looking for a way to start their own business from home and produce some extra revenue for and expenses or to cover job losses. The Federal Trade Commission, issued a bulletin where they are going to restrict and basically slap this type of scams.

The FTC’s tracking of work at home scams has shown an increase since 2006. The number of complaints filed in 2006 was more than 4000; this number grew to over 8000 in 2009. From 2009 to the beginning of 2012 I am sure these numbers have doubled again. This is due to the number of consumers seeking a true way to make extra income during the hard times over the past few years.

These new regulations will help protect consumers who do come across this work at home scams while looking for legitimate work from home jobs. This type of work at home companies will now be made to give specific information to the consumer so that they may evaluate the true and actual performance of the marketing claim.


What the FTC Rule Will Help With:

Here are some of the FTC’s rules that will guide all companies making these claims.

  • The seller’s identification information will be made public.
  • Whether the seller makes a claim about the purchasers likely earnings, (and, if the seller checks that “yes” box, the seller must provide information supporting any such claims)
  • Whether the seller, its affiliates or key personnel have been involved in certain legal actions (and, if yes, a separate list of those actions)
  • Whether the seller has a cancellation or refund policy (and, if yes, a separate document stating the material terms of such policies); and
  • a list of persons who bought the business opportunity with in the previous three years.

The company will be required to supply information about any employee or consumer who is joined or participated in a work at home business for the previous three years. They will need to provide actual details about these individuals who have profited supposedly from this business opportunity. If there has ever been a claim by a consumer concerning fraud or legal action taken, it must be listed and supplied publicly.

These new guidelines are scheduled to take effect on March 1, 2012. The good part about this final rule is the added protection it will give to consumers from false promises for quick money. It is been too long in coming for many individuals who have lost cash investments and many hours of work for only pennies and return.

The well-publicized unethical sales pitch of working at home stuffing envelopes and home assemblies of different product with guaranteed cash results will be brought to toe the line. These type of sale pitches are well drawn out to pull in the unwary consumer who might be down on their luck and wishing to make a few extra dollars. They do work, the sales pitches are well-designed, but most are misleading as to the final results achievable.

Many of these scams and others are based on the idea of very little work with high levels of return in payments. This should be the first red flag to pop up with anyone is searching for work at home jobs. If there was any means whatsoever to get these easy returns with very little work who would want to sell it. It’s a commonsense scenario; if it’s too good to be true, run away fast.

Some of these scams also include mortgage relief, ID fraud, and fake lottery sweepstakes. They will basically ask you to set up a payment plan and give out your credit card information with promises of blue skies and good times after that. Always check with the Better Business Bureau or the FTC to see if complaints have been filed against any company offering these type claims or promises.

What To Watch For:

Anyone offering these work at home opportunities or their affiliates who have been found to be fraudulent will be listed by the FTC. Their actual earnings claimed compared to actual results from consumers will be compared and scrutinized. These results will be made public from the companies history for the past three years.

There are many opportunities to start a work at home business that are legal, honest, and forthcoming with true results. If you think that you believe an opportunity exists or you can make $300 to $500 in your first hours of work, then backup and think again. Unless you are a doctor, lawyer or a CEO of a major corporation you will not see this type are return for a few hours investment.

I’m not stating that there are not legitimate jobs stuffing envelopes or assembling crafts at home. The just follow the normal warnings and double check any offerings before you sign up or give money to anybody. This ruling by the FTC concerning work at home opportunities will be a great benefit for anyone who trying to start a small business from home.

By forcing these companies to display their actual results from other individuals who have signed up, it will put a damper on their get rich quick schemes. I will add links to additional information for consumers considering a work at home job at the bottom of this article. There is also a video made by the FTC which offers some very good information concerning these scams and how to avoid them.

Don’t get distressed if you were hoping to make some needed extra income with a work at home business. You still can there are many opportunities and this ruling by the FTC will help clear the muddy waters. Be aware that the long arm of the FTC can only go so far. Companies outside of the United States are less likely to conform to this new ruling. Always, always check the sources. Then double check those results with actual consumers in forums or other social avenues that you can trust.

Any company or website that does not release this type of information and their current address should be ignored. Always make the advertisers of these work at home opportunities show you their personal information first before you show them your. There is never a once in a lifetime opportunity where if you do not pay today you will not get the opportunity tomorrow. This is one of the first steps laid out to draw consumers in to a well-planned scam.

Study the results of your research and give yourself time before you react or give out any personal information. An added day or two while deciding on a work at home opportunity will not make you any richer or any poor, but could save you some of your hard-earned money. If you have any questions concerning any work at home opportunities for work from home jobs that you’re not sure of please leave a comment for this article and I will check myself just find the legality of the offering.

Find More Information:

For your information or additional reading or to contact the FTC:

To find out more about business opportunity sellers’ compliance obligations, read Selling a Work-at-Home or Other Business Opportunity? Revised Rule May Apply to You or watch this new video. Consumers thinking about buying a business opportunity should read Looking to Earn Extra Income? Rule Helps You Avoid Bogus Business Opportunity Offers to learn more about the final Rule.

The Commission vote approving the final amendments to the Business Opportunity Rule was 4-0.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call
1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook and follow us on Twitter.

MEDIA CONTACT:

Office of Public Affairs
202-326-2180

Operation Empty Promises
Daniel Hanks, Attorney – Federal Trade Commission
FTC Info for WORK at HOME

http://www.ftc.gov/bizopps

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