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False hopes and the Feds

Posted by Michael Bloch in ecommerce (Wednesday December 13, 2006 )

Here’s another good reason to be careful of buying into online business opportunities promising to make you rich with next to no effort – and then recruiting others to do the same using wild unsubstantiated claims.

The Federal Trade Commission issued a press release yesterday about an ongoing operation called Project Fasl$e Hope$, which is a crackdown on scam business and work from home opportunities.

They’ve already netted quite a catch and in four recent cases being prosecuted, consumers were conned out of over $30 million dollars. The Feds’ action isn’t a small operation – the FTC, DOJ, USP Inspection Service and law enforcement agencies in 11 states are involved. What’s the bet that one of those states is Florida :).

One of the businesses who were caught in the sweep charged would-be online entrepreneurs up to $600 to create and host sites that were essentially just stacked with affiliate links. I assume those links had the vendor’s ID rather than the site owner’s. The scammers made out that they had formal ties with big online brands. Those big brands knew nothing about them.

People who purchased the sites were led to believe they would generate appreciable revenue through commissions on clicks that resulted in sales and also have expert coaching to help them build their business. People who bought these sites did not get paid and did not received the promised expert advice.

I’m really glad to see this operation happening; so often I get emails from people asking me to check out online business opportunities for them and more often than not they are scams.

Getting rich on the web is hard work for the vast majority of honest entrepreneurs. “Overnight successes” are quite often decades in the making. If you don’t want to get your hands dirty or put in the hard yards in to build a legitimate online business, you’re best off finding something else to do or lower your expectations; because many get rich quick schemes may actually send you broke, or perhaps you’ll wind up in court… or both.

Read more about Project Fal$E Hope$

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