As employees take advantage of the competitive job market resulting from The Great Resignation and low unemployment rates, job seekers need to be extra vigilant to avoid falling prey to scams.
"Demand for work-from-home options and flexibility, along with greater pay and benefits, continues to increase—but so do the related scams," said Keith Parsons, director of financial crimes for BOK Financial®. Parsons' team investigates fraud claims and trends, and addresses suspicious activity related to transactions.
Parsons reflected that he's been in his current role for 27 years, yet he has never seen such a drastic increase in fraudulent activity in such a short period of time. He noted, "Since November 2021, the volume and types of fraud are higher than ever." In alignment with this observation, consumers reported $5.8 billion in fraud to the Federal Trade Commission in 2021, a 70% increase from 2020. "My peers at other financial institutions are also reporting double and triple the number of fraud claims, with increases month over month right now."
“Since November 2021, the volume and types of fraud are higher than ever.”- Keith Parsons, director of financial crimes, BOK Financial
Many of the reported scams involve fake job postings and employer work-from-home scams. In the first quarter of 2022, the FTC reported that Americans were scammed out of $68 million due to fake business and job opportunities, many of which are targeting those under 25 years old who are on social media.
"It's a numbers game," Parsons said. "If these scammers can get even a fraction of their targets to fall for a $20 scam, that can potentially be a lot of money in their pockets." He said a lot of the current fraud tactics are a result of the pandemic and the rise in demand for work-from-home roles. "There are a lot of people being targeted on social media advertising as a quick way to make money, with a lot of 15 to 25-year-olds falling prey."
Common job-themes scams include:
- Car wrap scam: Ads for this scam claim you will make a couple hundred bucks wrapping your car with logos from a prominent company. The "company" sends you a check for more than that and tells you to deposit the money and wire the rest to another entity that will wrap the car. The check bounces after you've already wired the money and you're responsible for that amount.
- Secret Shopper Scam: In this scam, victims are asked to deposit a check sent from the "company" and keep a certain amount for themselves for their pay. Then, they're asked to withdraw the remaining amount and go to Walmart and purchase money orders while being asked to evaluate their experience. The blank money orders are sent to a specific address. When the check doesn't clear, again the victim is on the hook for the money withdrawn.
- Reshipping Scam: In this situation, there's often a job posting to be hired as a quality control manager or virtual assistant. Once you're hired, you agree to have shipments sent to your home and you're tasked with repackaging and reshipping them to various locations. Often, the items are high-ticket electronics that have been purchased with a stolen credit card and victims of this scam report not being paid for the work they've done. Additionally, during the hiring process, you give your Social Security number and can become a victim of identity theft.
What to look out for
Parsons said the scams are becoming more sophisticated, with fraudsters often making websites look more professional and trustworthy, setting up "HR departments" that appear real, and communicating more clearly. However, there are some red flags to note as you evaluate job postings:
- The job seems too good to be true. Promises of high pay, few hours and easy money are often indicative of a scam.
- You have to pay to become certified or begin work. Be wary of companies that require you to make your own investments up front.
- There is missing information about the company. Legitimate companies usually have an online presence, reviews and more, but if any of this is missing, you should be cautious.
- You are unable to confirm the offer's legitimacy.
- Being offered a role you are not qualified for.
What you can do to combat scams
When looking for a new opportunity, there are a few things you can do to protect yourself from scams:
- Search for the company on the Better Business Bureau, FTC, or your state's Attorney General website.
- Be wary if an employer finds a way to ask you for money.
- Don't give out personal information to a person or company you don't know.
- Be suspicious of any offer that doesn't pay a regular salary or involves working for an overseas company.
- Use your financial institution to help verify a check's validity if the situation feels suspicious or uncertain.
Protecting your business
"Of course, we're also seeing established businesses become the target of these scams," Parsons said. "In these cases, it's critical to use bank services to protect the organization." Safeguards such as Positive Pay and Reverse Positive Pay allow business owners to review all incoming and paid checks for potential fraud scenarios and create an added protection.
"There are ways to protect yourself as an employee and your business as a business owner if you're willing to take some additional steps to do your due diligence," he added.