Work at Home Scammers Ordered to Pay $95,000 in Consumer Redress

The Federal Trade Commission announced today that approximately 3,500 consumers who paid for phony work-at-home scams will be sent checks worth a total of $95,000 in redress.

The victims of the scam were misled by mass-mailings sent out by a company called EDI Healthclaims, the FTC said. Representatives of the "home-based business opportunity" tricked consumers into believing that they could work at home for healthcare providers by electronically processing medical billing for insurance reimbursement, according to the FTC's complaint.

The FTC alleges that EDI Healthclaims even promised consumers that they would help them find their first client and provide a list of medical providers needing these services, after the consumer paid a "licensing fee" of between $4985 and $5985. Consumers who were promised they would earn at least $1200 a month often made no income and lost their upfront fee, according to the FTC's complaint.

Consumers are urged to cash these legitimate checks if they were a victim of this scam. The checks are real but only valid for 60 days after the date of issue. Consumers with questions may call 1-877-678-0676. The FTC advises consumers that they never require payment of any kind, or the provision of additional information before the checks can be cashed.

To avoid falling victim to a work-at-home medical billing scam, follow these tips offered by the FTC:

• Ask the promoter to give you the names of many previous purchasers so that you can pick and choose who to call for references. Make sure you get many names from which to choose. If the promoter provides only one or two names, be careful: The contacts may be "shills" - people hired to give favorable testimonials. Interview the references, preferably where the business operates, to get a better sense of how the business works. Ask for the names of their clients and a description of their operation.

• Consult with organizations for medical claims processors or medical billing businesses and with doctors in your community. Ask them about the medical billing field: How much of a need is there for this type of work? How much work does medical billing entail? What kind of training is required? Do they know anything about the promotion or promoter you're interested in?

• Check with the state Attorney General's office, consumer protection agency and the Better Business Bureau in your area and the area where the promoter is based to learn whether there are any unresolved complaints about the business opportunity or the promoter. While complaints may alert you to problems, the absence of complaints does not necessarily mean the company is legitimate. Unscrupulous companies may settle complaints, change their names or move to hide a history of complaints.

• If the medical billing opportunity sells another company's software, check with the software company to find out whether company representatives know of any problems with the medical billing promoter.

• Consult an attorney, accountant or other business advisor before you sign any agreement or make any payments up front. An attorney can review the promoter's contract and advise you on how best to proceed.

The FTC is the nation's consumer protection agency against fraudulent, deceptive, and unfair business practices. To file a report, visit www.FTC.gov or call 1-800-FTC-HELP.

Source:
Federal Trade Commission