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

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