Monday, August 30, 2010

Tips - Franchising Fraud

Franchising has become one of the most popular ways for individuals to start their own businesses. However, without carefully investigating a business before you purchase it, you may make an expensive mistake. While the majority of franchisors are legitimate, a number of them operate under false pretenses. In these cases, the victim may be subjected to fast-paced, high-pressure sales tactics and is often given fictitious sales projections, testimonials, and slick promotional brochures. He or she is urged to act immediately to take advantage of a "ground floor" opportunity. When the sale is completed and money collected, a number of incidents may happen: the scam artist may disappear with the investment; the franchisor may go out of business; products or services may turn out to be inferior, overpriced, or unmarketable; or specialized training promised by the franchisor may be insufficient. By the time victims realize they have been scammed, it's usually too late.


The Better Business Bureau suggests using caution as the best defense. Before you enter into a business arrangement, be sure you fully understand the responsibilities of all parties. Under the Federal Trade Commission rule, the seller is required to provide a detailed disclosure document at least ten business days before you pay any money or legally commit yourself to a purchase. This information includes identifying information about the seller, background information on the business and its officers, and substantial details on how the franchise agreement works, along with restrictions on such things as geographical boundaries or conditions on the right to sell or transfer ownership.

Listen carefully to the sales presentation. Some sales tactics should signal caution. For example, if you are pressured to sign immediately "because prices will go up tomorrow," or "another buyer wants this deal," you should slow down, not accelerate, your purchase decision. A seller with a good offer does not have to use this sort of pressure.

If promises are made by a salesperson, be sure they're written into the contract before you sign. If the salesperson says one thing and your contract says nothing about the promise or says something different, your contract is what counts. If the seller balks at putting verbal promises in writing, you should be alert to potential problems. You might want to look for another business.

Unless you've had considerable business experience, you may want to get an attorney, accountant or a business advisor to read the disclosure document and proposed contract to counsel you and help you get the best deal.

Before doing business with any company, use the Better Business Bureau to search for a reliability report at http://www.bbb.org/

Tuesday, August 24, 2010

Choosing the Right Career Training School

Do you need to update your job skills or acquire new skills to get the job you desire? Career training schools, both public and private, can offer valuable preparation for those seeking entry-level job skills, a career change or upgraded training in a specific field.


A career training school also known as a vocational, trade, or technical school, should be investigated as carefully as any other service. Whether the training program is in automobile mechanics, computer programming, practical nursing, locksmithing or any other vocational career area, it is important to make an informed choice.

The Better Business Bureau suggests the following tips when considering a career training school:

• Obtain catalogs or bulletins from several schools, both public and private, that offer the training you are seeking. Is the school accredited by an organization recognized by the U.S. Department of Education? Is it licensed by your state Department of Education?

• Compare the courses, rates of completion, and job placement percentages with those being offered in your community by public schools, community colleges, nonprofit and for-profit schools.

• Talk to employers in your field of interest. Tell them your objectives and ask them if training in a career school would qualify you for a job.

• Visit the school and inspect its facilities. Are the facilities and equipment the same as described in the school's printed materials?

• Find out about the instructor's qualifications. What is the teacher-to-student ratio and the teacher turnover rate?

• Determine the costs for tuition, books, materials, lab equipment, financial assistance, residence and meals before signing a contract. Ask for details on the cancellation and refund policy.

• Know the requirements for and terms of the financial aid program. Get the facts about the institution backing loans, grants, or work study programs; how and when funds are dispersed; and how loans are repaid.

• Be wary if a school guarantees you job placement or makes promises about how much money you will make. An accredited school recognized by the U.S. Department of Education cannot legally make such guarantees. They can, however, provide you with written statistics on past graduates, their jobs and their employers.

• Contact the Better Business Bureau for a reliability report on the school.

Tuesday, August 17, 2010

Work at Home Scams Arrive to Take Advantage of the Unemployed

Work-at-home scams rise and fall along with the economy. Unfortunately, with many people out of work, this type of activity is widespread and may take advantage of those least able to afford any loss of money. The Better Business Bureau offers those looking for new employment opportunities some tips so that they don’t get burned in the job hunting process.


 
“Frustrated people anxious to earn some money must be carful about being taken advantage of by deceitful scam artists,” warns Steve J. Bernas, president & CEO of the Better Business Bureau serving Chicago and Northern Illinois. “This type scam exists because it preys on the desperation of people, making it even more despicable.”

 
Complaints to the BBB about work-at-home scams are averaging more than ten a month with an increase of 14% over last year.

 
Libna Perez, a complainant from Elgin, Ill. states, “I saw the ad and it looked like it was perfect for me. I have two kids and no one to watch them if I work. My husband’s business closes down during part of the winter and money is tight. I sent in a check for $30 or $35 and was supposed to get a kit with envelopes and paperwork to stuff in the envelope. They said that this would be my own business and that each envelope that they sent me would have $5 inside. It was supposed to take ten days to get the kit after my check cleared and I complained to the Better Business Bureau after it took three weeks. They company had not been returning my calls. The president actually called and yelled at me after I filed a second complaint with the Better Business Bureau but they sent me my refund…”

To avoid falling victim of work-at-home scams, the BBB recommends the following warning signs:

  • Overstated claims of product effectiveness;
  • Exaggerated claims of potential earnings, profits, or part-time earnings;
  • Claims of "inside" information;
  • Requirements of money for instructions or products before telling you how the plan works;
  • Claims of "no experience necessary."

 
The BBB also notes that when most people respond to an advertisement for working at home, such as stuffing envelopes, they will generally receive - for a fee - instructions as to how to place similar ads in other publications, also offering work at home opportunities. Allegedly, they will get paid for each response you receive and send back to the original company.

Many work-at-home schemes have been put out of business by the postal authorities. In addition, the U.S. Postal Service advises that envelope stuffing is a highly mechanized process, virtually eliminating any possibility of working at home.

“Other work at home promotions may involve assembling crafts or pillows,” Bernas explained. “Be aware that advance fees for the necessary materials are often required, that the crafts may take longer to assemble than represented, and that the company will pay only for finished products it deems acceptable.”

For more information on this and other scams, visit www.bbb.org

 

Tuesday, August 3, 2010

Shred It and Forget It

Free Shredding Services August 21 at U.S. Cellular Field and September 11 at the West Suburban Bank in Downers Grove

Each year more than 8 million Americans fall victim to identity theft, according to a Javelin survey, losing over $40 billion. But now there's a free way you can protect yourself from ID thieves. You can "Shred It and Forget It."

To an identity thief, one person's trash can literally become another person's stolen treasure. By going through garbage cans and diving through dumpsters, thieves dig out documents with valuable information from names and social security numbers to bank and credit card information.

"If you're putting your personal or business information in the trash, there's a chance that somebody's going to get a hold of that and use it for purposes you don't intend," Better Business Bureau serving Chicago and Northern Illinois President & CEO Steve J. Bernas said. "One of the most popular schemes among these low-tech identity thieves is finding pre-approved credit card offers in the trash."

The first shredding event is on Saturday, August 21 from 9AM-2PM at U.S. Cellular Field, Lot A, on the west side of Wentworth between 33rd and 35th streets, in Chicago.

The second shredding event is on Saturday, September 11 from 9AM-2PM at the West Suburban Bank, 2800 Finley Road in Downers Grove.

Hosts of the annual event include the Better Business Bureau along with the City of Chicago’s Department of Business Affairs & Consumer Protection, Cook County State's Attorney's Office, Federal Trade Commission, United States Postal Inspection Service, Chicago Police, Illinois Attorney General's Office, and the Cook County Department of Environmental Control.

This shredding service is FREE. The Better Business Bureau and its partners are hosting Shred It and Forget It – up to ten boxes of papers shredded per person.

Monday, August 2, 2010

10 Ways to Spot Work at Home Scams

Beware of “jobs” or “business opportunities” that seem to offer high pay for work you can do at home. Often these programs are bogus.

Common scams involve package forwarding, Internet searches or advertising, envelope stuffing, medical billing, discount or coupon programs, rebate processing, distributorships, sales, or the purchase of special equipment or software to start businesses.

Many people lose large sums of money through work at home scams. Some versions of these scams - like package forwarding – might also involve the victim in crimes such as identity theft and handling of stolen merchandise.

Here are 10 tip-offs that the “opportunity” could be a scam:

1. Big bucks for simple tasks. Watch out if they promise to pay you a lot of money for jobs that don’t seem to require much effort or skill. Sound too good to be true? It might be a scam.

2. Job offers out of nowhere from strangers. If they offer you a job without getting an application from you first, meeting you, or doing an interview, it’s probably a scam. Don’t hand your personal employment information to such folk (especially your Social Security number!). That could lead to identity theft.

3. Requests for up-front payments. If someone wants you to make an advance payment to “get in” on the ground floor of a new business opportunity - especially if it’s a big investment, or you don’t have much information about the deal - this is a big red flag. Don’t do it. “Advance fee scams” are very common and they come in many varieties.

4. They ask you to wire the money. If you wire a payment to somebody, it’s gone forever. Wire transfers of money are a convenient and perfectly legitimate service. But scam artists often ask you to wire payments that they are requesting (especially to destinations in other countries!) because they know you won’t be able to get your money back.

5. High pressure to do it now. Don’t be in a hurry to accept an unsolicited offer of work, or to make a business investment, particularly if the other party is asking you to spend your money on the deal. Take your time. If somebody tries to convince you that this is a “limited time” offer and you have to act now, just tell them to forget it. Ignore anybody who pushes you to agree. High pressure is a big sign that something’s wrong.

6. Refusal to give you full details in writing. Ask for complete information in writing. Request proof of any claims. Look carefully at any documentation they might provide to make sure it answers all your questions. If they won’t give details, or don’t respond to questions, don’t do business with them.

7. References are missing or a bit suspicious. A real business should be able to give you many professional references – not just a few. Be sure to ask for references and check them yourself. Don’t be swayed by a few written testimonials that sound fabulous. Even if the references seem good, don’t make your decision based on references alone. Do a careful background check. For starters: try a web search on the company name and see what comes up.

8. Contact information is missing or doesn’t make sense. Be very cautious if a company is trying to get you to accept a job or do business, but seems to lack any established physical location with a real street address. A cell phone number and website address are not enough contact information. If there’s no street address, look out! (P.O. boxes are not comforting – scammers often rent them, and move on quickly.) If there is an address, it’s worth taking a moment to check it on the Internet. It’s common for phony operations to claim they are at an address that is not their true location. Nowadays we have online tools like Google Street View photos of address locations and “whois” website owner lookups that may be helpful.

9. They want you to buy a bunch of expensive stuff. If they expect you to make a major purchase of equipment, software, inventory, or information in order to get started in business, be very careful. Often these are the most persuasive kinds of scams. It seems like it might be a real business opportunity – but it’s not. Here’s what happens: the buyer makes the purchase and never receives the things needed to set up the business. You can avoid this situation! Check the business out completely before you send a dime.

10. It’s got a bad rating with the BBB! Victims do complain to the BBB about work at home scams. It only takes minutes to check a company’s record with us at www.bbb.org. Do the search. Or call the BBB if you want help figuring out whether you are looking at a scam. It could save you a fortune. If you’ve been victimized, file a complaint with BBB! Other organizations can help too: your city government’s department of consumer affairs; your state attorney general’s office; and the Federal Trade Commission (FTC).

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