Online business scams come in three forms: non-existent businesses, misrepresented products or services, and fraudulent pyramid schemes. Look out for job postings with free email addresses, poor grammar, and unrealistic promises. Verify product reviews and use secure payment methods. Check multi-level marketing plans for offers that primarily earn from recruiting and research company information.
A scam is a fraudulent attempt to make money, and the term online business scam is used to describe three different types of ventures that use the Internet, or online environment, in their attempts to scam people. First, an online business scam can refer to a non-existent business: a front. Second, it can refer to a business that sells products or services that exist, but do not live up to their description. And third, it can refer to fraudulent businesses such as those built on pyramid schemes, which has become closely associated with Multi-Level Marketing (MLM), also known as network marketing. Carefully following a few steps can help you detect and avoid getting involved in an online business scam.
One way an online business scam is presented is through a job posting, so when you go through job postings, there are several things to look out for. One is an email address provided by a free service, rather than one attached to a company’s online website and branding. A second is the failure to clearly identify the hiring company and provide contact information and the company website address. A third is poor grammar or non-standard phrasing. Online job postings that sound too good to be true are likely online business scams, and it’s safe to assume that any promises of huge sums of money and reduced hours for people with no experience, training, or special skills are a scam.
An online business scam can also be presented through an advertisement for a product or service that is not as advertised. Brilliant testimonials from people who are identified only by name are a sign. Huge quantities of products or services for a low special offer or a greatly reduced price in limited time is another. If you’re unsure, use a search engine to try and find independent product reviews. Find out about any warranties, and if you decide to buy anyway, use a payment method from a company that will support you, and reverse the payment if the product is not as advertised or is never delivered.
Pyramid schemes are a type of online business scam that can appear legit in many ways. When a multi-level marketing plan masks a pyramid scheme, the Federal Trade Commission (FTC) recommends checking in several ways. First, look for offers where you earn primarily from recruiting and selling to your recruits rather than sales to end customers. Thoroughly check company and product information. Research outsiders’ opinions about the product and company, paying close attention to any lawsuits. Gather information from insiders and make sure you understand any restrictions and any charges that may apply to you.
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