While it has no hard numbers, the Better Business Bureau reports it has seen many different ways in which unemployed people have been defrauded. Scams targeting job hunters were so numerous last year that they ranked No. 5 on the BBB's top 10 list of scams and ripoffs.
In addition to bogus work-at-home schemes, job seekers have also been soaked by being asked to pay phony fees to people or agencies to find jobs, says BBB spokeswoman Alison Southwick. Other scams are more inventive, such as one in which applicants are offered jobs but are told that to be considered they must first obtain a credit report by going to a website and entering personal information. Doing so results in unexpected monthly charges to a credit card. "Instead of being a job opportunity, it was actually just a marketing tool to get people signed up (for) a credit-monitoring system," Southwick says. The ploy isn't as absurd as it sounds, given that many employers today gauge credit worthiness as part of a candidate's qualification.
Online job boards, such as CareerBuilder.com and Monster.com, are all too familiar with such scams and have dedicated pages on their sites that provide job seekers with tips on how to conduct safe online searches. "What we're trying to do is provide the safest environment for both -- obviously -- our job seekers, but our employers customers as well," says spokesman Steve Sylven.
Employment scams have resulted in numerous enforcement actions by the FTC. They include one last summer that halted a phony job-placement service in Florida. Operators of the scam placed advertisements in local newspapers around the country, urging job seekers to call a toll-free number staffed by telemarketers. The callers were then asked to provide information about their work histories and pay a placement fee of $89 to $195 in exchange for full-time work with benefits, which never materialized. What's more, their money was never returned.
The FTC advises job seekers to be wary of ads that promise results. While many placement firms are legitimate, others may misrepresent their services, promote out-dated or fictitious job offerings, or charge high fees in advance for services that may not lead to a job. The FTC offers these tips:
- Reject any company that promises to get you a job.
- Be skeptical of any employment-service firm that charges first, even if it guarantees refunds.
- Get a copy of the firm's contract and read it carefully before you pay any money.
- Understand the terms and conditions of the firm's refund policy. Make sure you understand what services the firm will provide and what you'll be responsible for doing. If oral promises are made, but don't appear in the contract, think twice about doing business with the firm.
- Take your time reading the contract. Don't be caught up in a rush to pay for services.
- Stay away from high-pressure sales pitches that require you to pay now or risk losing out on an opportunity.
- Be cautious about purchasing services or products from a firm that's reluctant to answer your questions.
- Be aware that some listing services and "consultants" write their ads to sound like they are jobs, when they're actually selling general information about getting a job.
- Follow up with the offices of any company or organization mentioned in an ad or an interview by an employment service to find out if the company is really hiring.
- Be wary of firms promoting "previously undisclosed" federal government jobs. All federal positions are announced to the public on www.usajobs.gov.
- Check with your local consumer protection agency, state attorney general's office, and the Better Business Bureau to see if any complaints have been filed about a company with which you intend to do business. You also may contact these organizations if you have a problem with an employment-services firm.