Online Scams Epilogue: How to actually make money on the Internet

So, how do you make money on the Internet?

Perhaps I’ve given the impression that it can’t be done, but that’s not true. However, the answer may not be what you want to hear.

Basically, you have to have something or create something that other people want, and figure out how to deliver it over the Internet.

The easiest way is the most obvious: sell things on eBay. If you have a supply of antiques, collectables or anything else lots of people desire, create an eBay account and go for it. It’s probably not going to be a full-time career or bring you millions of dollars (unless you’re extremely shrewd), but it can be a source of income that doesn’t involve a ton of work on your part.

Other than that, you pretty much have to create something. If you make things by hand, there’s a site called Etsy that allows you to put up a “store” for your wares. Again, it’s probably not going to be a career, but it’s a way to leverage a hobby into extra income.

The blogging world has some success stories. A lot of sites (I Can Has Cheezburger? comes to mind) that have become cultural icons are essentially using a fairly standard blog format. They mostly generate income through advertising revenue (and some of them get book deals later on).

It’s tough to do, but it can be done. Remember; Google, Yahoo!, MySpace, Facebook and Twitter were all created by small groups of people with ideas for sites people might like.

So that’s how you make money on the Internet: create content that people want, or sell a service or product. Perhaps there was a time when putting up a page with nothing but paid links to other sites would have worked, but those days are long gone. The Internet just isn’t “neat” enough anymore, in and of itself, for that sort of thing to work. You’ve got to create your own business on the Internet. It’s not easy, and you might fail over and over, but I hear it’s a pretty sweet life when it works.

Online Scams Vol. 3: Work at home scams are everywhere

Crooks these days. They’re nothing if not adaptable.

Have you seen the number of work-at-home “jobs” being offered on the Internet these days? They know what’s up. A lot of people are losing their jobs and are looking for something new. And it’s a great American tradition—recession (or depression) takes your job, start your own business!

However, the fact is that most people don’t have the right kind of entrepreneurial “spark” needed to start a successful business venture. It takes a certain kind of grit, a deep belief in yourself and your “product,” the ability to hold your head high when faced with failure (and to learn from that failure and move on, instead of taking it personally and wallowing in it), and the kind of positive attitude that, frankly, tends to get obliterated when you’re worrying about how you’re going to pay the mortgage next week.

Let’s face it: starting your own business is way, way tougher than working for someone else. How many times have you seen someone start their own little store because they were “tired of working 40 hours a week,” and you check out their new digs and they’ve got no clear vision for their business, they’re trying to be everything to everyone, and they’re only open five or six hours per day because they’re trying to make owning a business easier than working for someone else? How long did they last?

And I think most of us, deep down, know that. “I’d love to work for myself, but yeesh! 18 hour days, seven days a week?” It’s okay to admit that you’re not a natural born entrepreneur (can you become one? Of course. You can become anything you intend). But most of us know—it is a path of great resistance.

Send in the Work-at-Home-Scam Clowns.

They sound great, don’t they? Stay at home, do some menial task that takes ten minutes, and let “the power of the Internet” (or something) do the rest. You’ll have so many Porsches by this time next year, you won’t know what to do with them all!

Of course I’m going to tell you they’re all completely full of baloney. Nobody is going to pay you hundreds of thousands of dollars per year for nothing.

“Oh, but they’re not paying you,” you’ll say. “You’re starting your own business!”

Well, at best you’re going to pay them a large amount of money for a “startup kit,” fees, or other such bull. You’re not going to assemble kits at home, you’re not going to enter any data, and you’re not going to get paid to stuff envelopes. You’re going to get ripped off.

Fraud.org (run by the National Consumers League) has a great article called “Tips for Avoiding Work-at-Home Scams.” I would recommend you take a few minutes to read the entire article, but the following is a summary of their tips:

  • Know who you’re dealing with
  • Don’t believe that you can make big profits easily
  • Be cautious about emails offering work-at-home opportunities (real companies do not recruit in this way. Ever)
  • Get all the details before you pay
  • Find out if there is really a market for your work
  • Get references for other people who are doing the work
  • Be aware of legal requirements (medical billing requires a license, for example)
  • Know the refund policy
  • Be wary of offers to send you an “advance” on your “pay”
  • Do your own research about work-at-home opportunities

I would amend that fourth tip slightly: just don’t ever pay someone else to work for them.

About.com also has a nice article on this topic: “Work at Home Scams.” I’d suggest you read this as well.

Finally, never, ever trust the phrase, “Other work at home sites are scams, but I found one that isn’t!” There are tons of fake blogs out there. I even found one by searching for “work at home scams.” It had a whole article, possibly culled from a trusted news source, about avoiding these traps. It claimed to be an article from a newspaper in Cleveland. As you read, you suddenly find you’ve been eased into a sales pitch about how “this one isn’t a scam!”

Do they need to make it any more obvious?

Online Scams Vol. 2: A few more words about Google scams

Do a Google search on something. “Fender Telecaster,” whatever. We’ll go with that, since it’s a topic I’m interested in.

Hey, this is a blog, not a democracy.

Now look at the results page that appears. The two-thirds of the screen on your left contains your regular search results. The right third of the screen, however, is a list of paid advertisements. See how it says “Sponsored Links” at the top? That means those are not “pure” search results. Those are Google AdWords listings. Every result in this list is there because somebody paid to have it there.

Now look closely at your “regular” results. For most searches, you’ll see it once again again—”Sponsored Links.” There is a very pale yellow background behind the first couple results. Once again, the owners of those sites paid money for their businesses to appear there. The first “real” search result (if you use our “Fender Telecaster” example) is a page hosted at Fender.com, which makes sense.

My goal here is first to point out how there is just a massive amount of advertising on the Internet, even when performing a simple Google search.

Secondly, my goal is to point out that these advertisements are not from Google. No matter what those “Sponsored Links” say, they are not affiliated with Google (unless you search “Google” or “AdSense” or “AdWords,” which are legitimate).

Search “make money with Google” and a whole bunch of sponsored links come up on your right…and they’re all scams, as far as I can tell. “$100,000/month Guaranteed” my foot. That one even says it up front: you have to pay them to sign up, which is one of the easiest ways to detect a scam.

(By the way, do NOT click any of these links if you’re actually doing these searches along with me. This is your one warning. I am not responsible if you ignore it.)

Supposedly, Google is cracking down on these scams, or at least trying to stop them from appearing on their own advertising setup. However, as of today, these scams are still rampant, and they’re still using Google AdWords to lure people in.

If you are interesting in using AdWords to advertise your business, or using AdSense to make money from your blog or other website, make sure you’re at the actual sites hosted by Google. The links I provided above are the real ones. By the way, anyone telling you that you have to pay them to sign up for AdSense is scamming you, too. It doesn’t cost you anything to participate in that program.

Here’s a short list of Google scams I have heard of so far. Do not trust any of these, or anything that sounds even a little bit like them:

  • Google Works
  • Google Kit
  • Google Money System
  • Google Cash
  • Google Cash Kit
  • Make Money Posting Links on Google
  • Easy Google Profit
  • Google Treasure Chest
  • Scott’s Money Blog
  • Josh Made Cash
  • Earn Cash Fast With Google
  • Joan’s Money Making Story

This list probably doesn’t even scratch the surface. Those last four are fake blog sites that are supposed to make you think they’re written by somebody “just like yourself.” They even have an embedded program that figures out where your location is, and makes it sound like the blog’s “author” is from nearby.

So, keep your head about you when you’re running a Google search. Those Sponsored Links aren’t your most trustworthy source of information. And just don’t fall for anything that promises huge amounts of money involving Google.

Heck, even with AdSense, unless your blog is getting thousands of hits per day, you’re probably not going to make more than a few dollars. I’m not saying don’t do it. After all, passive income is the best income, don’t you think?

Online Scams Vol. 1: Words that mean it’s probably a scam.

In the late 1990s, the Internet really captured the collective imagination as a way to make a ton of money. There was the classic depiction of a “Dot-Com Startup,” a company made up entirely of hip, cynical recent college grads (or even precocious dropouts) who made instant millions by apparently wearing cargo shorts to work and spending the entire day playing foosball in open-design offices with weird artwork all over the place.

I’m still not sure how their business model worked (and ultimately, it didn’t), but that was the popular image. The ones who were smart enough to sell before anyone noticed they were just playing hackey-sack all day made a lot of cash.

You’ve also got stories like Google and Facebook and Twitter—sites that were started by small groups of people, that became massive online juggernauts.

Yep. The Internet has definitely made quite a few millionaires. We all know it, and that’s why so many people are getting ripped off: online moneymaking schemes.

First off, the people who have truly made lasting fortunes on the Internet did so by offering something unique that lots of people wanted. They created something. They didn’t go to a website and sign up for an “affiliate program” that required them to give their credit card numbers.

That’s why I’m doing a little series this week on the world of online scams. Today’s topic: words that are a pretty good sign you’re looking at a scam.

If the URL (address line) of the site, or if the name of the site have any of the following words in it, you are very likely going to lose money very quickly if you hand over your credit card information:

  • fun
  • free
  • profit
  • money
  • million
  • cash
  • fast
  • rich
  • wealth
  • internet
  • online
  • web
  • immediate
  • instant

Just…don’t trust these sites. I don’t care what they’re called. FunInternetProfits, InstantOnlineMillions, FastInternetCash, whatever. I’m just making those names up, but I can almost guarantee they’re real sites (do NOT visit them, though. You’ve been warned).

For one thing, what website has the word “Internet” or “online” in its name anymore? Do you really need to specify that in 2009?

For another, why is it that “fast cash, no work!” sounds like a complete rip off when it’s an ad in the back of Rolling Stone, but when it’s on a website, people fall for it? Anyone can put up a website, folks. Terrorist groups that operate in complete secrecy have websites. There is no vetting process for having a website.

There is also a special case: scams that try to latch onto Google. There’s one called Google Works that I know of specifically. They start by charging you $1.97 for…well, they don’t really tell you. Then they take $69.97 from you every month. See, they’re taking money from you. That’s the opposite of profit.

There are many more of these Google scams. Google Cash is one I’ve heard of, but I’m sure Google Profit, Google Millions and Google Wealth are out there somewhere. They’re all scams. Don’t even try.

Now, Google does run an affiliate program called AdSense that’s legitimate. A lot of bloggers use this on their sites. It generates little ads that are probably related to the content of your blog. In this case, you’re hoping visitors to your site will click on these ads, which will generate a few cents for you. However, unless you’re running a site that gets a few hundred thousand visits per month or more, you’re not going to make a whole lot from it.

The other problem with AdSense is that sometimes ads for scams using Google’s name show up. That means ads for Google Works and other scams are using Google’s legit advertising affiliate program to lure people. I think Google needs to pay more attention to the people they allow to advertise through their program, don’t you?

Also an exception: there is a site called Get Rich Slowly, a blog that provides excellent financial advice from a guy who’s gone from a heavy debt burden to debt free over the course of a few years. He’s not selling anything (unless he has a book out that I don’t know about), and he’s not offering a way for you to make money. You go to the site to read articles and learn. Make sure you’re at getrichslowly.ORG, not COM. The COM is somebody trying to sell website addresses (a very 1995-style business venture). Avoid.

Identity Theft Myths: Online banking and shopping are unsafe

I know, most people already know that shopping and banking online are pretty darn safe. Amazon wouldn’t be the leviathan it is today if people were still afraid to shop online. However, there are still some folks out there who think doing anything online is an open door to getting your identity stolen.

The truth is, it’s probably safer.

Think about your monthly bills. Your paper bill starts by passing through who-knows-how-many hands. Then it sits in your mailbox unattended until you take it (assuming it’s still there). Later, you write out a check (with your full name, address and account number on it), place it in an envelope with your bill (which has yet another account number on it), and leave it unattended in the mailbox with the little red “Hey There’re Checks In This’n!” flag sticking up. Assuming nobody steals it from your box, it once again passes through who-knows-how-many hands on the way to its destination. At the end, a human being (i.e., an entity capable of error) has to manually input your payment and handle your paper check.

If you receive and pay online, however, you receive an email that only you can see. It probably won’t even have your full account number in the message. You go online to pay the bill, logging in with a password only you know. Your payment is taken from your account right away, and it is processed by a machine, which will usually only make an error if you make an error.

Additionally, the security at online retailers and financial institutions is unbelievably tight. The only time anyone really runs into trouble is when they fall for a phishing scam and give their passwords out to other people, or when they use a site that shouldn’t have been trusted to begin with. Your credit union, bank, and the major retailers are fine. If you’re not sure if a business is trustworthy, check them out on the Better Business Bureau.

Identity Theft Myths: Thieves will use your information for years

There are still enough people who believe this one to consider it widespread enough to talk about here.

There was a case back in the 1990s where a woman was a victim of an identity thief. This person used her name for over a year and a half, and ruined her credit (and a big chunk of her life in general). I remember seeing the story on one of those “news magazine” programs (20/20 or something), and I’m pretty sure there has been at least one made-for-TV movie about it.

It’s probably on Lifetime every now and then. The title is something like [Adjective] [Noun], the [Person’s Name] Story. Then again, all their movie titles are like that. They’re like Mad Libs.

Anyway, these days it’s far more common for thieves to take your identity for a “joyride” of a couple weeks’ duration. They’ll rack up all the charges/goods/services they can, then move on to the next victim. Oh, it’s still just as big a pain for you to fix, but cases of long-term cloning over the course of months and years are rare now.

Part of the reason is technology. People catch the theft much sooner, and more and more financial providers have built-in safeguards, which can provide some protection, or at least early detection. I think another reason is that identity theft has increasingly become the realm of organized crime. With a backlog of identities to work with, they can use them for a short time, then move on to the next identity before the fraud alerts start showing up.

None of this is exactly comforting, I suppose. Like I said before, it still takes you a long time and a lot of hassle to clear up any identity theft. But those widely publicized cases of long-term identity theft are the exception rather than the rule nowadays.

Hit these links

Let’s take a break from the Identity Theft Myths series today, and instead look at some other topics from other places on the web.

“Is Facebook becoming Phishingbook?” explores a social media scam that seems to be growing lately. Summary: if you’re Facebook friend tells you they’ve been mugged in London and need you to wire money, don’t.

Excellent advice from Craigslist. There is a lot of fraud happening through this popular site. Summary: only buy/sell locally, and never wire money. Ever.

“10 Ways to Avoid Sneaky Work-at-home Scams” is exactly what it sounds like. Summary: the economy is weak and these scams are only going to become more common.

“Beware of Cash For Clunkers Scams.” I’ve covered this here before, but the Eastern Michigan BBB has some more information on the topic. Summary: CARS works by taking your heap, junker or jalopy (or “hoopty,” in the parlance of our times) to a dealer and trading it. There is no pre-registration or anything.

We’ll return to the Identity Theft Myths next Monday. Until then, have fun.

Identity Theft Myths: Identity theft is a high-tech crime

What springs to mind when you hear the words “identity theft?”

Be honest, now.

For a lot of people, the first thing they think of is their home computer. Because of the constant emphasis on computer security (and a few made-for-TV movies, I don’t doubt), many people are under the impression that your identity gets stolen because you were on the Internet and a hacker broke into your computer and got your personal information.

Of course, hackers exist. What used to be the demesne of nerdy college kids and spoiled brats with powerful computers and too much unsupervised time has become an important tool for organized crime.

However, not all identity theft occurs online. You don’t have all your credit card numbers, account numbers, passwords, Social Security number and other information stored on your computer anyway, do you?

Do you?

Tell me you don’t.

Anyway, a huge chunk of identity theft occurs through very un-high-tech channels. Your purse or wallet get stolen, and you were carrying your Social Security card with you. That’s an open door.

Or you received a load of credit card offers in the mail and simply tore the envelopes in two (or not at all) and threw them in the trash. That night, somebody picked through your garbage and found it. It’s the dark side of Dumpster Diving—what used to be a fun way to drive around college towns in June and score free microwave ovens is now a common route for identity theft.

If picking through garbage isn’t gross enough for you, there’s this little factoid: between 10 and 25% of identity theft victims knew the person who stole their identity. That’s your friends and coworkers. It could even be your family members.

The wide range in this percentage seems to depend on who is doing the research. You see both numbers in different reports, but there may be an age-related factor: younger people tend to know the person who stole their identity more often (as many as 40% of people under 30, according to some data I’ve seen). The point is, a lot of identity theft happens because somebody left their purse unattended at work.

Of course, this doesn’t mean you can ignore online safety. Keep your virus/spyware protection updated and don’t fall for those phishing attempts (which I know you won’t because you’ve been reading the FPU, right?). But look at the low-tech ways you might be making yourself vulnerable. Get a crosscut shredder today if you don’t already have one, and get that Social Security card out of your wallet, already.

Identity Theft Myths: You don’t have to worry if you have bad credit

I’m going to do a series on identity theft myths over the next couple weeks. I might not end up doing them all in a row, though.

A lot of people think they don’t have to worry about identity theft if their credit is lousy. “Use it all you want,” they think. “You’re not going to get approved for anything anyway, and you can’t make my credit any worse than it is.”

Wrong.

For one thing, even though our current financial situation has made it a little harder to obtain credit, there’s still a possibility that somebody, somewhere will grant the identity thief credit using your information.

However, identity theft isn’t always about obtaining credit and making purchases.

Someone could use your information when they get arrested. When they don’t show up in court, the police could appear on your doorstep, and they’ve heard “you’ve got the wrong guy” a million times, so that won’t help you much. Trying to get a mistaken police record cleared up is a hassle you want to steer clear of.

Someone could also use your information to obtain employment. There is a story I see all the time about a woman who applied for a job at Target, then found out she already worked there, according to their records. Someone was working there using her social security number. I actually haven’t seen a version of this story specific enough to indicate it’s anything more than a made-up anecdote, but the fact is that people steal identities in order to obtain employment. Perhaps it doesn’t hurt you at all, and perhaps you never even find out. However, what if they commit a crime while on the job? It could end up following you.

There’s also medical identity theft.  This is the scariest scenario, because it could cost you your life. When someone uses your identity to obtain medical care, you could end up with insurance companies and hospitals calling to collect payments on services you did not receive. Worse still, incorrect medical records attached to your name, including information such as chronic diseases and allergies, could kill you. What if the fact that you’re severely allergic to a drug gets removed from your record, and you’re brought in unconscious and unable to speak up?

So, even if your credit is less-than-perfect (or just plain awful), don’t assume you’re safe from identity theft. Just because they can’t buy a car using your name and information, doesn’t mean they can’t use it for something (or sell it to someone who can).

Unfortunately for the rest of us, thieves are resourceful that way.

Scamming the scammers: a really, really bad idea

One of the cool things about running this site is that I get to see the search terms people have used to find their way here. “WA Surveys” has been a surprisingly common search that has led visitors to the FPU, and “mystery shopper scam” has brought in some traffic. I hope I’ve provided some value to those folks.

However, you also get some weird ones.

The other day, the search term that led someone to the Fraud Prevention Unit was “i want to scam the mystery shopper scam.”

This was a little disturbing to me.

I know what some people are thinking; “Well, they’re crooks, so it’s alright to try to rip them off, right?” And I can understand the impulse—vigilante justice, give them a taste of their own medicine, free money in a down economy, etc.

But it’s a really bad idea to even try. For one thing, the crooks perpetrating the scam aren’t going to feel your wrath at all. They just printed up a bunch of fake checks and sent them out to thousands of people. They’re usually not linked to any real accounts at all, and they’re certainly not linked to accounts owned by the criminals themselves.

But wait, there’s more!

At the point you knowingly present a fraudulent instrument (such as a cashier’s check) to a bank or credit union, you are committing fraud on a financial institution. That is a federal offense, and it carries a prison term if you’re found guilty.

This is serious, serious business.

Besides, a lot of these scams are run by organized crime operations. At some level, there are probably some violent people involved. These are not people you want to go messing around with.

Okay, there’s not a huge chance they’ll find out about your little attempted counter-scheme, but why risk it? You’re already not going to get to keep the money, and you might end up in a federal prison. Do you really need goons coming after you, on top of everything else?

Stay vigilant.