BBB Fraud Alert: Young adults and college graduates are common targets of employment fraud

The summer season is an exciting time for many young adults as they enter the workforce after graduating from high school or college. Unfortunately, not all job postings online are legitimate and many fraudulent employers specifically target young adults by offering them entry-level positions that promise high salaries and flexible working hours.

The BBB’s 2023 Scam Tracker Risk Report found that employment fraud is the second riskiest consumer scam in the country, with a median loss of $1,995 and a 5% increase in risk from last year. In Texas, consumers reported more than $750,000 in losses to these scams since 2023. Across all age groups, employment fraud tends to affect 18- to 34-year-olds the most.

While most reports BBB receives involve fraudulent employers offering data entry or package forwarding jobs, graphic designer, mystery shopper and human resources positions are also common. All reports include the opportunity to work from home or remotely, often with flexible hours and an hourly or monthly wage that is well above standard.

Contact is usually made via email. The recipient claims to represent a fictitious or imitated company and found the recipient’s email address through a job board, LinkedIn, or in response to a job application they submitted. Shortly thereafter, the conversation is conducted via an online messaging system such as Skype or Telegram to schedule and conduct an interview. The interview is conducted entirely via text message and ends with an immediate job offer that begins the next day. After accepting the job offer, the scams vary depending on the position and industry.

To identify fraudulent jobs for the most common types of positions, BBB offers the following breakdown for two broad categories:

Data entry, administrative assistant, office or secretarial positions

Fake checks are a common employment scam tactic at such places. Once an offer is accepted, the scammer claims the company will give them a check to set up their home office. The check is either emailed or mailed directly to the employee’s address, and they follow the instructions to deposit it into their account and then provide proof. Once deposited, the scam can go one of two ways:

• The employee claims that an error on the check caused the employee to be overpaid. They often attribute this to a logical typo, such as accidentally adding an extra zero so that $300 became $3,000. The scammer demands that the new employee immediately repay the extra money using a direct payment method such as a mobile banking app, gift card, or wire transfer.
• The employee will direct the employee to a third-party vendor through which they need to purchase their office equipment. The website often looks legitimate and the employee can easily find all the products they need. When paying, the total price is exactly the amount shown on the check and the employee enters their banking information to complete the purchase.

In both cases, the victim’s bank eventually realizes that the check is fake, and the employee loses and never receives the amount they returned or used to purchase the office equipment. When they try to contact the representative again, all messages go unanswered and social media profiles previously used to establish credibility are deactivated. In addition, banks often preemptively freeze the accounts associated with a fraudulent or fake check deposit, or in the worst case, delete them, creating additional recovery challenges for the victim.

Positions for parcel reshipment, quality control or product distribution

These positions only require a candidate to provide a valid home address and their time, making them very attractive to many people. They often offer a base monthly salary of between $2,000 and $4,000, with additional bonuses for each package delivered to their next destination. Most victims who encounter this scam receive and ship packages as expected until it’s time for their first paycheck – only they never receive any money. When they try to log into an employee dashboard, their account is locked and all their messages go unanswered.

According to the FBI, scammers who use stolen credit cards to purchase expensive items may be involved in forwarding scams. Instead of shipping the item directly to their address, they use a “forwarding agent” to send the package overseas. Forwarding agents for packages may also involve stolen goods or laundered money, causing victims of this scam to unknowingly participate in illegal activities.

Preventing employment fraud

Check the options for working from home. The transition to remote work has created many opportunities for legitimate and fraudulent companies. While many work-from-home job postings are honest, it’s important to critically evaluate the hiring process of any company offering this type of employment. Be wary of companies that require the applicant to download a specific mobile app for communication, conduct the entire interview via text or chat, or do not provide a physical address of the company.

Check contact details. BBB recommends checking that the address provided matches the business and that the phone number is valid. Scammers often use addresses of vacant lots or other businesses and a phone number that is either fictitious or not valid. At the very least, check that you can get in touch with company representatives through at least two contact methods.

Research the company. Take the time to research a company’s reputation and legitimacy before agreeing to work for them. Check BBB.org to see if the company is listed and look online for reviews from past employees or customers. If the offer is from a well-known company, check their official job board to make sure the position is listed and use the contact options provided to reach the hiring team.

Be cautious of immediate offers and start dates. Any pressure to sign or come on board immediately suggests the company may not be reputable. Choosing where to work is an important decision that most reputable companies are aware of and that requires time to consider. Be especially cautious if the position is offered without an interview or a high salary is promised if the employee pays for coaching, training or certifications. If the hiring team threatens that the job will be given to the next candidate if you don’t make a decision right away, it may be best to walk away.

For more information, visit BBB.org.

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