Employment scams are on the rise in the turbulent job market created by the COVID-19 pandemic, a new Better Business Bureau® (BBB®) study finds. BBB warns job seekers to verify employment offers to avoid illegal jobs, identity theft, and fake checks to which millions are exposed annually.
The in-depth investigative study — Job Scams: BBB study finds job scams increased during a pandemic, warns job seekers to verify employment offers to avoid illegal jobs, identity theft, and fake checks — details the many forms employment fraud takes and the scams that often result. Read the full study here.
Job scams have been a problem for years. In 2020, BBB estimated 14 million victims with $2 billion in direct losses related to job scams. Last year, the 2020 BBB Employment Scams Report by BBB Institute for Marketplace Trust found job scams to be the riskiest of all the scams they tracked in 2018 and 2019. However, BBB’s study finds that the problem worsened in 2020. Losses reported to the FBI’s Internet Crime Complaint Center (IC3) about employment scams were up 27% between 2018 and 2020, while complaints to the Canadian Anti-Fraud Centre (CAFC) nearly doubled in 2020.
BBB Institute’s 2020 report on job scams found that this fraud most commonly victimized people ages 25-34, with women filing 67% of complaints about this fraud. The median financial loss reported by these victims was $1,000; in addition, they often reported a loss of their time, as 32% were never paid for the work they did for an “employer” that turned out to be fraudulent.
Identity theft is a common outcome of job scams, as scammers often steal job seekers’ personal information to open bank accounts to further their fraud. BBB found 34% of victims provided their driver’s license number and 25% provided their Social Security or Social Insurance number.
Fake checks also frequently accompany job scams, and they continue to grow. This new BBB study finds that 36% of job scam complaints to BBB involved a fake check, with fake check complaints to the Federal Trade Commission (FTC) increasing by 65% between 2015 and 2020. In the two years since BBB issued an investigative study on fake check fraud, losses absorbed by banks themselves due to fake checks went up 40% to reach $1.3 billion. Common fraudulent job offers involving fake checks include mystery shopping or secret shopper jobs, car wrap jobs, nanny or caregiver jobs, and small business jobs such as photography or painting houses.
A St. Louis woman who lost her job during the pandemic was recruited through a job search website for a job as a remote assistant for a large company. The “employer” deposited a check for $2,400 into her bank account to purchase equipment from a third-party vendor, then asked her to buy $2,400 in Home Depot gift cards and text them the numbers on the back. She heard nothing further from the “employer,” but her bank informed her that the check deposited to her account was fraudulent. She not only lost the funds she spent on the gift cards but had another $2,400 stolen from her bank account.
Employment scam victims frequently become unwitting accomplices in other fraud, used as money mules, to mail fake checks, or to participate in reshipping scams, which represent 65% of the scam job offers reported to BBB Scam Tracker. Scammers “hire” victims from job boards, Facebook, or Craigslist, offering to pay them as much as $2,500 to receive and then send on packages. These fraudsters often use stolen credit card numbers to order laptops, cellphones, and high-end goods and have them sent to reshipping victims, instructing them to repackage the goods, and providing shopping labels to send the packages to a new address, often in Russia. The accomplices who were hired for this fraudulent type of work are never paid, and their identities may be used to open bank accounts.
The FTC has taken action against job scammers, including a fake job placement company the agency sued in 2019. Associated scams such as reshipping schemes and money mule schemes have been a focus for state and federal law enforcement; in December 2020, the Department of Justice announced the results of a worldwide effort to deal with money mules, resulting in action taken against 2,300 people.
Tips to avoid job scams:
- Research the job offer. Call or go directly to the actual company’s website for contact information to verify the job posting.
- Check on businesses offering jobs at BBB.org.
- Do an internet search with the name of the employer and the word “scam” to see if there are reports involving job scams.
- Examine the email address of those offering jobs to see if it matches the protocols used by an actual company. Be alert to gmail business email addresses.
- Consider creating a separate email address when posting a resume on job boards or applying for jobs. This can help detect “offers” from scam employers you did not contact.
- Consider setting up a second bank account simply to handle pay for jobs where you have never met the employer in person.
- If you’re paying for the promise of a job, it’s most likely a scam.
- Be very wary of mystery shopping or secret shopper positions.
- Work-from-home jobs that involve receiving and reshipping packages are likely scams.
- Beware of jobs that involve receiving and forwarding money.
- Don’t fall for a fake check scam. BBB is not aware of any legitimate job offers that send checks to applicants and ask them to send money to a third party.
- Be cautious in providing personal information such as your full address, birthdate and financial information in your resume or to unverified recruiters and online applications.
- Be wary of vague job descriptions.
- Even if you do the work, it still may be a scam.
- Do not respond to calls, text messages or emails from unknown numbers or suspicious addresses.
- Do not click any links in a text message from a number you do not recognize. If a friend sends you a text with a suspicious link that seems out of character, call them to make sure they weren’t hacked.
It is important that victims of job scams report them to:
- Better Business Bureau – BBB.org or BBB.org/scamtracker.
- Federal Trade Commission (FTC) – reportfraud.ftc.gov or call 877-FTC-Help.
- Internet Crime Complaint Center (IC3) – ic3.gov/complaint.
- Canadian Anti-Fraud Centre – antifraudcentre-centreantifraude.ca or 1-888-495-8501.
About BBB – BBB is a nonprofit, business-supported organization that sets and upholds high standards for fair and honest business behavior. BBB services to consumers are free. BBB provides objective advice, BBB Business Profiles on more than 5.3 million companies, 11,000 charity reviews, dispute resolution services, alerts and educational information on topics affecting marketplace trust. Visit BBB.org for more information. There are over 100 local, independent BBBs across the United States, Canada and Mexico, including BBB Serving Central East Texas, which was founded in 1985 and serves 19 counties.