The Web: Land of Opportunists - Industry Trend or Event

Home Office Computing, Oct, 2000 by Lisa Roberts

THE CONS ARE AS OLD AS THE BROOKLYN Bridge, but today's slick-looking Web sites are giving age-old scams an air of legitimacy. And while the target market hasn't changed--folks with few job skills, stay-at-home parents, senior citizens, dreamers--the reach is infinitely broader, the sale quicker, and the money greater.

According to the Better Business Bureau (BBB), in 1999 work-at-home offers generated more inquiries than any other type of business and ranked ninth in number of complaints filed--up from 33rd four years earlier.

That should be no surprise. Have you seen posters on phone poles promising "Work at Home! Earn $2,000/Month!" as you drive around town? Now imagine sending the same message to thousands of prospects with a click of a mouse.

With work-at-home scams sprouting all over the Web, law enforcement agents around the globe are working overtime to weed them out. Earlier this year, 150 organizations in 28 countries and five continents banded together for "GetRichQuick. Con," a two-week Internet sweep that turned up 1,600 suspect sites.

"We were looking to get a snapshot of which `get rich quick' schemes were out there," explains Marianne Schwanke of the Federal Trade Commission. The suspect sites were sent warning messages. When the FTC made follow-up visits two months later, 40 percent of the sites had disappeared or deflated their claims.

Can It Happen to Me? Terri Vincent, a Cody, Wyo.-based virtual assistant, can't believe the company that duped her out of $18,000 continues to send her e-mail solicitations. Eager to join the e-commerce revolution, Vincent had bought three $6,000 "units" of an "exclusive" brand-name store in a new Internet mall. But the agreement the owner claimed to have with a well-known toy distributor didn't exist, and the ambitious advertising campaign slated for early 1999 vaporized--leaving Vincent and 18 others scammed out of $300,000.

While Web versions of traditional investment schemes are taking root, new scares exclusive to cyberspace have also popped up.

Auctions: The FTC, home to the largest fraud database in the country, says 50 percent of all complaints about Internet scams involve auctions, where sellers routinely don't deliver what they promised or deliver nothing at all.

Web site cramming: Schwanke reports that another common scam is to offer a free Web site for 30 days. After taking your credit card number for authorization, monthly fees begin to appear on your statement for a site that will never exist.

Pyramid schemes: You'll also find other garden-variety pyramid schemes such as "e-mail processing"--a Web take on envelope stuffing--and CD-ROMs (successors to booklets and reports) that resell "valuable information" like bogus work-at-home job listings.

Grassroots Sting To protect her members from fraudulent business opportunities, Cheryl Demas of WAHM.com--an Internet portal for work-at-home moms--goes undercover, sampling suspect offers and reporting on her experiences, at wahm.com/under.html.

Recently Demas followed up on a computer-recorded message left on her answering machine requesting that she call an 800 number if she wanted to work from home. Two 800 calls, one mailer, and $40 later, Demas learned the business was selling herbal products. "It was deceptive, to say the least," she recalls.

"Scam artists prey on the emotions of moms who want to do right by their kids," adds Cyndi Webb of Moms Network (www.momsnetwork.com). "So many stay-at-home moms are so eager to work, they just jump right in without even the most basic research."

Webb advises her members never to make an investment decision on an emotional level. That, coupled with a commonsense approach never to pay an obscure company money up front, can safeguard your interests. Webb adds: Sometimes protecting one's assets is "as simple as calling the BBB."