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FTC Busts ‘Contrepreneur’ Work Scams

The following is a guest post by Sid Kirchheimer:

They’re not entrepreneurs. They’re “contrepeneurs,” or scammers who dupe people who are trying to start up their own businesses.

The Federal Trade Commission on Thursday announced law enforcement actions against seven companies it says are perpetrating these cons.

The firms claim to help people set up home-based businesses as mystery shoppers,  website operators, or processors of credit card payments and government insurance refunds. The companies targeted are not nationally known [read this FTC release for their names].

The legal action was part of a broader federal-state crackdown on companies that have allegedly duped at least 2 million work-seeking Americans. Touting easy money and secure assignments, the schemes instead deliver worthless informational materials, hidden or undisclosed recurring charges and empty promises.

Six of the seven were the first alleged to have violated the Business Opportunity Rule, enacted by the FTC in March. It requires the sellers of any home-based business opportunity to provide important disclosures on a one-page form.

So before investing in any “be your own boss” opportunity, know what the rules say and heed this advice:

AARP recently partnered with the Small Business Administration to provide reliable  information to 50-plus folks who are trying to start their own businesses. Follow the SBA’s blog and get other insights on this AARP page.

Photo credit: celesteh via flick.rom