How to Spot a Scam

Tips for exposing scam businesses.

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When someone offers you a "once in a lifetime" business opportunity, it's easy to get your hopes up and let your guard down. Here are some tips for exposing scam businesses.

• Ask the company for documents about its lawsuit history. Most reputable businesses will provide them.
• For a publicly traded company, look at audited financial statements at http://www.sec.gov/edgarhp.htm. Employ a trusted accountant, if necessary.
• Don't get excited by testimonials. Ask the company to provide proof of typical earnings. Walk away if there's no information in writing.
• Contact those invested in the business. The Federal Trade Commission requires most promoters to give you the names and numbers of participants.
• Check for complaints on Internet message boards and at consumer-protection agencies.

Learn how to remove your name from mailing lists.

From Reader's Digest - June 2000

 

• Get Rich? Get Real
• Americans are falling for get-rich-quick pitches.
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• Better Business Bureau
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