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8 Signs Of Business Opportunity Scams

How To Easily Recognize A Business Scam

Many opportunities to build a small business are scams, clearly disguised as legitimate offers. Many that aren't scams fail to mention the risks or potential downsides involved. The key to finding a legitimate offer is to keep your guard up and investigate the claims being made. If it sounds too good to be true, you probably have a good reason to be suspicious.

Avoid taking anything at face value and investigate all the costs. Many times, there are considerable start-up costs that are only mentioned in the small print, if at all. Whenever you're dealing with a considerable amount of money, proceed with caution. Take note of the following signs.

1Businesses That Claim To Be Easy

Anything that claims to be easy, or claims to be little or no work should be examined with skepticism. If it were that easy, they wouldn't just set up several income streams for themselves and keep it a secret? If it's easy and it works, everyone would be doing it for themselves. That would make the competition fierce, which would destroy any profits very quickly.

2Vagueness Is A Warning Sign

If the offer is vague enough that you don't even really understand what is involved, that's usually a sign to stay away. Companies with legitimate offers want to give you all the details. They are proud of what they have to offer and want to tell you about it.

3The Revenue Stream Doesn't Make Sense

How does the company making the offer make money? Do they primarily make revenue by charging you for training, advertising, a website, and other fees? If they're not profiting, then they wouldn't be making the offer.

4The Warranty Is Riddled With Loopholes

You might find warranties that use words like possible, can, may, or potential. Companies with legitimate products and offers wouldn't require a weasel clause in their warranty. You want to associate with a company that has an iron-clad warranty.

5An Obscure Location

The people offering the opportunity are located in some obscure country. Legitimate opportunities can come from anywhere. However, if the company in question is located in some place like Liberia, there's a reason for additional caution.

6Talks More About Marketing

An offer talks more about magical marketing than the magical product. A great business opportunity has a great product, exclusivity, or a great brand behind it. The marketing should come second.

7Out Of State Companies

Be especially wary of opportunities that cost less than $20,000 and involve an out of state company. It's too costly and difficult to sue an out of state company with the current commerce laws. Federal prosecutors typically won't look at anything less than $30,000, because they are too busy.

8Suspicious Ads And Toll-Free Numbers

Be wary of ads in newspapers and magazines that have little information besides outrageous claims and a toll-free number. Just because the ad is in the Wall Street Journal, doesn't mean it's legitimate. There are several ways to check on the legitimacy of the company in question. You can contact your state's Attorney General and the Better Business Bureau. Just remember that a lack of complaints isn't a guarantee that you aren't being scammed.

If you feel that you were taken advantage of, ask for your money back. If that doesn't work, let the Attorney General's office know what happened, and provide them with any relevant correspondence. When faced with a business opportunity, move slowly, and be cautious. If you are pressed to make a quick decision, that's probably a good reason to say "no." Keep an eye out for the warning signs and protect your money.




About Author

John Quintana

John Quintana is a proud Cuban, a lifelong resident of Miami, Florida, where he lives surrounded by a loving family. When he's not writing, he spends his time either fishing or in the kitchen.