Job-seekers beware. Job scams are hitting record highs.
A group of college students got scammed through a message purportedly sent by the college placement office. Another group was hit when they posted resumes online. Consumer interest in certain side hustles causes another group of con artists to mobilize.
The Federal Trade Commission recently reported that “income” scams — most of which involve bogus job offers — have risen to record levels. Victims have lost $150 million to these cons in the first nine months of 2020 alone.
To be sure, job scams are not a new phenomenon. They tend to rev up anytime the economy is on the ropes. However, the Covid-induced recession has fueled them like never before. That’s partly because the pandemic solves the crooks’ biggest problem — explaining why the “employer” doesn’t want to meet in person.
High unemployment and the long delay for a second round of pandemic unemployment assistance also makes victims more vulnerable. And because work-at-home jobs truly are proliferating, crooks hide in the crowd, making their offers appear so similar to real ones that it’s hard to tell the difference.
“Many people have lost their jobs and are desperate,” says Linda Sherry, director of Consumer Action in Washington, D.C. “At the same time, everyone is hearing about all these people who are working from home. Scammers swoop in to capitalize on that.”
What the crooks want
The con artists are going after one of four things.
- identifying information, such as Social Security or credit card numbers, to pull off identity theft;
- passwords to get into your bank or PayPal accounts;
- access to your computer (which they’ll use to get access to your financial accounts);
- a personal check, that they’ll trick you into believing is a “reimbursement”
The most costly scam
Far and away the most costly of these cons is the check. That’s mainly because there’s no fraud protection for victims.
Unlike PayPal, credit and debit card transactions that limit fraud losses for victims, if you write a personal check to a crook, you are on the hook for the full amount. In the vast majority of cases, there is no way to get your money back.
Worse, if you deposit the crook’s check into your account, you could also face other nasty repercussions, such as having your bank account closed or being prosecuted for fraud. Banks are sometimes skeptical if the victims.
Unfortunately, this scam, which starts when the bogus employer sends you a check to supposedly buy supplies or pay for a service, is also among the most common.
Fake checks are at the heart of roughly one-third of the latest job cons, according to the FTC. Typically, these cons involve “hiring” the victim, who is then given a check from the crook posing as their new employer. The bogus employer will have some reason for providing a payment that far exceeds what you’re owed.
The crook might tell you that he/she hasn’t yet set up a corporate account in the U.S., and needs you to deposit their out-of-state/out-of-country check so you can secure office space or buy office supplies, for instance. Mystery shoppers and people willing to wrap their car in advertising are told that the checks are to pay for getting the car wrapped or buying products for the mystery shop.
Why it works
The reason this con is effective is because the con artists can tell you to deposit their check and wait until it “clears” before using that money to send or spend money elsewhere. That makes the fake check appear legitimate.
What the crook knows and you probably don’t is that banks must provide provisional credit for most checks within two days. That does not mean that the check has “cleared.” It can take weeks before the bank realizes that the check is fake. Even if it takes months, the bank has the right to debit your account for the full amount of the fake check.
Victim’s median loss: $2,300, says the FTC. Young workers in their 20s are the most common targets.
Spotting job scams before you’re taken
Legitimate job sites, such as Indeed and Glassdoor, attempt to screen out crooks. But the crooks are agile, which means you have to be skeptical of job postings even on legitimate sites. However, you should be able to spot and avoid job scams before you’re taken by paying attention to the red flags.
Job scam red flags
What are the red flags of a job scam? They vary with the con, but will usually include at least one of these:
- The “employer” doesn’t have a corporate email address. Instead, they’re using gmail or another generic service. A corporate email will usually have the company’s name after the @ symbol, such as [email protected].
- You can’t Zoom. Even during the pandemic, legitimate employers set up in-person meetings with job candidates, even if that meeting is via Zoom. Scammers typically want to communicate only by chat, text or email. They don’t want you to see their faces.
- The employer sends a link for you to fill out their job application. You should be able to access a legitimate company’s application by going directly through the corporate website. Beware links. They can go to spoofed sites and sites that load malware onto your computer.
- The employer contacted you out of the blue — not because you filled out their application or because of a friend’s referral. If you were contacted because of a referral, a legitimate employer will tell you who recommended you.
- You are asked for identifying information, such as Social Security numbers or bank account information, before you’ve been formally hired.
- They employer wants to send you a check before you start work.
- The employer wants you to send them a check to pay an “application” or “processing” fee. (A handful of sites reviewed on SideHusl.com require applicants to pay for their own background checks. However, this is relatively rare and only comes up in predictable settings, such as when you’re applying for jobs caring for children and the elderly.)
“Times that are hard for consumers are great for crooks, says Susan Grant, director of Consumer Protection at the Consumer Federation of America. “They take advantage of people’s economic despair.”