Q: I went back and reread your March 21 column about fraudulent schemers, but don’t see the scheme that my aunt-in-law just lost money investing in. Please explain the advance fee scam. — Ned Nephew

A: Dear Ned: As long as lawbreakers continue to sneak among us, their scams will flourish. Even though I’m familiar with the advance-fee temptation, I checked my FBI source for more explanatory detail.

Work-at-home schemes are the bane of existence to law enforcement authorities. A prime example is an advance-fee con (may be more recognizable as “envelope stuffing”) that instructs you to place an ad like the one you saw in magazines and online and ask people to send you information about working at home. It usually entices people who aren’t able to work outside the home, such as the disabled and young mothers.

By the way, a legitimate company would send you materials to mail out on its behalf and pay you for your efforts.

Of course, in this case, you must pay an upfront “small” fee that you won’t recoup unless some other poor victim answers your mailing with a fee of his own.

Caution. This is an illegal pyramid scheme because there is no real product or service being offered. You won’t get rich and, worse, you could be prosecuted for fraud.

medical billing fraud

Another advance-fee conspiracy is the fraudulent medical billing job. Ads for prepackaged businesses — known as billing centers — are found in newspapers, on television and on the Internet. If you respond, you’ll get a sales pitch that tells you what seems like common knowledge; for instance, “As you know, we have a terrible crisis in the health care system and processing paper claims is most of the problem. We’ve trademarked a special electronic claim processing program, which health care providers use to save time and money.” The baddie promises a generous income working full or part time — even with no experience — as well as clients eager to buy the services. Moreover, he doesn’t say you need a license, which you do because you would work with confidential data.

Your investment of $2,000-$8,000 rarely earns this amount back, much less the assured “generous” fees. Because competition in the medical billing market is brutal and large and well-established companies hold the reins, rest assured your new career is a sell-at-home fraud.

“inspections” are the rub

Another ad might say, “We’re looking for honest workers to assemble quality craft products from home. Make serious $$$$ making jewelry/children’s toys/decorative items. No experience necessary.”

The craft assembly worker starts by buying a starter kit from the company and, after assembling the items from the kit, the worker (you) sends them to the company for inspection. Why are we surprised to learn the “company” charges an inspection fee? Also not surprising is that the goods will be rejected because they fail to meet quality standards.

Poor you — left with the option of either paying a fee to have the goods returned or of writing off the inspection fee and the cost of the starter kit.

To add insult to injury, many of these craft assembly work-at-home companies allow their workers to resubmit work for inspection an unlimited number of times but charge a fee for the privilege. Unfortunately, the work never passes inspection; in fact, it’s unlikely any inspection even takes place since the scamming company makes its money from selling the starter kits and charging inspection fees.

pyramids ahead

The pyramid scheme is in a class all its own. Offering their own brand of excitement and attraction, these get-rich-quick scams entice folks of all ages, levels of education and intellect. Even though I mentioned this scheme in the first paragraph, these deceptions deserve a column all their own so I’ll feature the WATCH OUT alerts in next week’s column.

Postscript: During the application process for work-at-home and other types of job-related schemes, folks are asked to provide personal information, such as bank account numbers where your “earnings” may be direct deposited. Losing your shirt with these crooked ventures may be only part of the problem; it’s also quite possible you’ll lose your identity. Protect personal info at all costs.

Ellen Phillips is a retired English teacher who has written two consumer-oriented books. Her Consumer Watch column appears on Saturdays in the Business section of the paper. An expanded version is at www.timesfreepress.com under Local Business. E-mail her at consumerwatch@timesfreepress.com