NFIB

It Sounds Too Good To Be True!
03/ 28/ 2002

When it sounds too good to be true, it almost always is not true. Despite the fact that everyone has heard these words of wisdom, thousands of people are duped every year by unscrupulous con artists. The Internet has provided an easy way for bogus offers to be sent to businesses and homes across the country.

In today's Workshop, Edith Helmich reviews 10 scams from the Federal Trade Commission's list of scams that proliferate via bulk e-mail:

1. Business opportunities

Business schemes that offer maximum income for minimum work (often for no work at all) are most likely illegal pyramid schemes.

2. Bulk e-mail

Solicitations to provide lists of numerous e-mail addresses likely violate the terms of service of most Internet service providers. At the least, your ISP may shut you down - at the worst, you may find yourself in legal hot water.

3. Chain letters

Whether traditional or high-tech, chain letters are illegal. A bogus product does not make them legal. Almost everyone loses his or her money.

4. Work-at-home schemes

After paying the "small fee," information is sent on how to find your own customers, or the products you assemble are deemed unsatisfactory for payment.

5. Effortless income

The get-rich-quick schemes take many forms - world currency markets, newsletters or real estate - but, unfortunately, success invariably requires hard work.

6. Free goods

After paying a fee to join a club, you are expected to bring in additional members before qualifying for the free items. Most are pyramid schemes providing profit to the promoters rather than to participants.

7. Investment opportunities

Beware of investment schemes that promise outrageously high rates of return with little or no risk. Promoters often take in money, close down quickly and then reopen under another name to avoid apprehension.

8. Guaranteed loans or credit on easy terms

The promises of no-risk home equity loans or credit cards without any requirements are scams that will yield useless lists of lenders, who will most likely turn you down or promise credit cards that never arrive.

9. Credit repair

Repairing a bad credit record requires paying back your debts. If you follow advice to lie on a loan or credit application or misrepresent your Social Security number, you will be committing fraud. You alone will be responsible.

10. Vacation prize promotions

Beware of "winning" or "being selected for" a fabulous vacation for a modest price. More fees may be in the works for upgrades, preferred dates, etc. Worse yet, the vacation may be a shabby, low-budget experience.

Be an informed consumer and carefully check out unsolicited offers. While there are some good deals out there, always be wary and remember: If it sounds too good to be true, there's probably a reason.

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