The stuff of schemes

You’ve heard of the “right stuff” — the mix of bravery and brass that author Tom Wolfe told us powered the nation’s first astronauts to conquer space. Well, here’s the wrong stuff — a work-at-home envelope-stuffing scheme that bilked more than 50,000 people out of over $7 million.

In a case announced today, the FTC charged that convicted felon David Brookman and his companies falsely promised that people could earn $5,000 a week by stuffing envelopes with flyers and mailing them. The FTC says the defendants charged an up-front fee of $99 to $399 for their program, calling it a one-time fee that would bring big paychecks for home-based workers.

What did people really get? According to the FTC, just a few supplies and the bad news they would have to buy more supplies, and pay their own postage and other costs, to try to make money. They also learned they would only be paid for enrolling new recruits in the scheme — not for mailing flyers. As for the handful of people who actually made money? On average they got a total of less than $20.

But Brookman has nerve, alright. In addition to his felony convictions for forgery and theft, he settled a lawsuit in 2013 with the state of New Jersey for operating the same kind of envelope-stuffing scheme. The FTC’s Business Opportunity Rule required Brookman and his companies to tell potential enrollees about the New Jersey lawsuit. The FTC says they didn’t, and that’s one more violation of the law.

Here are a few tips to help you avoid a similar scam:

  • Be skeptical of promises from business opportunity sellers that you can make big money working from home, especially when the “opportunity” requires you to pay an up-front fee. Envelope-stuffing schemes are a classic work-at-home scam.
  • If the seller doesn’t gives you a one-page document — required by the Business Opportunity Rule — that gives you key information about what the seller is promising, don’t hand over your money.
  • Check out the seller’s claims. If you’ve never heard of the seller, enter the company name in a search engine with words like “complaint” or “scam,” and read about other people’s experiences.

To learn more, read our article about Work-at-Home Businesses.

Blog Topics: 
Jobs & Making Money

Comments

Thanks for providing this wonderful service.

Thanks for this heads up. Almost got involved with one of these and didn't. Thank God!

thank you for this valuable information !

I have received two telephone calls at my home someone states that the IRS has a lawsuit against and that I should call the number they leave on my message machine. I have not called them back or answered their call. I am a 75yr old single woman living alone. Please advise.

When you have a tax problem, the IRS will first contact you by mail. The IRS won’t ask you to wire money, pay with a prepaid debit card, or share your credit card information over the phone.

If you get a call like this, file a complaint with the Treasury Inspector General for Tax Administration at tigta.gov. You also can file a complaint with the FTC at ftc.gov/complaint. If you’re concerned there’s a real problem, call the IRS directly at 800-829-1040.

Please ignore such calls. IRS will never call you or send you an email about any issue with your tax returns. They will contact you by mail only. So please do not fall for such bogus calls. If in doubt, please call IRS directly. Thank you.

I have had the same phone call this week. I did call the IRS and was given the run around. But I am going to contact the FTC. I just want to cuss these idiots out. I am hoping that no one falls for this.

This has happened to me twice this week...same phone number calling. I am your age and they call at 6:30am...it's a recording and to call back at the number listed on my screen.

Why isn't Brrokman put in jail after stealing $7M from customers and Fraud committed on the Public. There is never anything for FREE!!! 11-25-2015.

I was scammed by someone posing as an officer at police station. He told me my grandson had been in an accident but he was alright and they were holding him there so I ask him what was his bail. He said 1,870. I got the money and sent it to him by money gram. He told they would take a money gram and said I would get it back when he went to court. needless to say I lost my money. My husband found an article that said money grams had a program that could get our money back and that didn't work out either. Thank you for your articles

Someone called me and told me I was scammed by someone, He was the scammer.

Keep getting calls even when number on Do not call list. They cover up names and come thru as Private Calls. How are they able to get away with this?

I got a call for a loyalty grant for $9,000.00 by this website WWW.fafsa.ed.com. Scam? I tried searching for the website but couldn't find it.

Some scammers call from a made up “government” agency or official-sounding organization. They say you'll get a grant and you won't have to pay it back. But then they ask you to send money to get money. This FTC article about grant scams tells more.

Hey Bridget thanks for the help as 99% of the telemarketing calls to the house phone have stopped. Glad the FTC is finally maintaining the do not call list

Someone called knowing my name, left a meesage on my answeing machine and said to call 877-230-1225 and left a long pin number. I did not call.

I answered a call from a man that sounded like he was from India, along with others calling in the background. He told me that he was calling because he was from Microsoft and was told that I needed help on my computer, which was true. He gave me his name and employee number but didn't give me time to look it up, just kept asking questions.
Then he asked permission to see the problems that needed fixing, which blossomed out with more questions which took a lot of time. Finally, he told me that he could fix it and I asked how much it would cost. He answered, "Four dollars and ninety five cents", which I couldn't believe but figured was o.k. He had looked around inside for a long, long time. Then he made a call and I looked up on top of my screen and saw he was registering my name and credit card numbers to send money to somewhere else! Then I realized what I had done and he told me that I had to go to Walmart and send that money...$495.00!!! I refused and he said that he would lock up my screen if I didn't do it, which I didn't do and couldn't believe what I had done. My screen got locked and I realized much more...it was Friday afternoon and if I didn't do something quickly,I'd have to wait until Monday to call Microsoft. I quickly went to the bank and (buzziest time of the week) was helped with new credit and debit cards, which would take about a week to get. I just couldn't stop thinking of what else to do.

after searching for my notes and commenting, I have not had time to search around this blog. I will try again when I have a chance, as I didn't even read one part when the screen popped open with the question and I wrote the comment there. Thank you for that opportunity to type about the scam though! I'll be back again to answer other questions ASAP --Bee

Had an email at work saying I have a warrant for check fraud... They have my social security number listed on the email how can I get this undone? I never have or would break any laws and this is freightening that I have to sign up for the service that protect your social security number... This happen to anyone else what did you do

So grateful for your website.
There is a current scam that involves someone calling your home pretending to be an "officer" from the IRS stating money is owed. The scammer will tell you your home is being watched and if you don't send money, the police will come to your house and detain you for 3 days. They also tell you to find a place, like CVS, to wire the money.
Thank you for providing information to educate consumers. Hope these fraudsters are caught and placed behind bars very soon!

I keep getting calls from a number saying that this is my final notice that the IRS is filing a law suit against me but it's never a person always a recording then leaves a number for me to call back an when I do its always busy they have called four times in one day

Since many of the calls are coming from switching centers, I say that they should be told to turn in the scammers especially if they want a lighter punishment. If they refuse, they must face it in full for failure to cooperate. Perhaps, this would get them to turn in those making the scams let alone be able to trace where the calls are coming if they are just using their places as routers to get to others. Another thing is that I feel that making it a criminal offense with a good jail time would make a lot of them occur less. However, until those scammers are to be arrested for good amount of time, they will always continue to make harassing calls knowing that they can always get away with it because there is so little to stop them.

Allied bankruptsy group is so fradulent and have all your info.

I have been getting scams for a couple of years. I've gotten the IRS lawsuit scam. The Microsoft scam the lower your intrest credit card scam. This may sound pretty crazy but because I had 3 or 4 a day, I picked up the phone pressed whatever to get a representative and when they answered I blew a VERY LOUD WHISTLE and hung up. I do not get hardly any more calls. I think everyone should take the time to do the same. These calls are mostly from India. And they are wearing headsets. I know you are not suppose to answer but these people do not stop calling. The whistle works.
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