Scouted or scammed? Employment scams becoming more prevalent

Aly McConnell was thrilled when a message popped up in her email inbox offering her a remote position with Insurify, an insurance comparison shopping website. The recruiter assured her she was a top candidate and offered her unlimited PTO, as well as other enviable benefits.

Ms. McConnell had been mass-applying for remote positions after her company experienced layoffs in 2023 – and while she didn’t remember applying to Insurify, she was happy and relieved when the offer came in. When the recruiter asked her to download a chat app and became pushy, asking for banking and Social Security information via unencrypted email, Ms. McConnell became skeptical and reached out to Insurify’s "head of people" on LinkedIn, to see if the job offer was legitimate. “They said, 'no, we haven't been talking with anybody right now. We just posted that. I don't see you're an applicant in the system,’” said Ms. McConnell, who then realized she had been speaking with someone posing as an Insurify representative. “After that, I started only applying locally because I was a little bit hesitant to apply remote because I'm like, ‘well, I might get scammed again,’” she said. Unfortunately, Ms. McConnell’s experience is not unique – job scammers are evolving with employment and tech trends, taking advantage of job seekers in a tight market. According to the Federal Trade Commission (FTC), people lost $367 million to business and job opportunity scams in 2022, a nearly 76% increase from 2021. What’s more, the median loss was a whopping $2,000. Compare that to the $650 median loss for all fraud types combined in 2022.

Chris Coleman, president of the Iowa division of the Better Business Bureau, said he has colleagues who field constant calls from people inquiring about or reporting job scams. “We provide information to people hundreds of thousands of times a year,” he said, noting that the organization’s pages on job scams get 1.5 million hits a year just for Iowa alone. Adam McCoy, director of recruiting and operations for the Skywalk Group, has worked in the job recruiting business for 15 years and has seen a marked uptick in job scams, which he attributes to the vulnerability of workers in a challenging economy. “The cost of living has outpaced wages in some industries,” he said, noting that inflation and company downturns can create the perfect storm for scams to occur, calling scammers “opportunists.”

Scammers evolve

According to a study by the Better Business Bureau (BBB), an estimated 14 million people are exposed to employment scams every year. Most scammers used online recruiting platforms to target their victims. Gone are the days when charlatans used classified ads for stuffing envelopes and yard signs on street corners advertising get-rich-quick schemes working from home. Today, scams are hard to spot because they often look like the real thing. Sophisticated technology has enabled scammers to create legitimate-looking websites and impersonate real companies. Recruiting companies have seen an uptick in automated “reach out” technology to reach as many applicants as possible, changing the pitch to match market conditions – for example, responding to inflation by promising more wages. “The more messages they get out there, the more lines they get out there in the water, the more likely they are to hook a fish,” said Mr. McCoy. Job scammers even go so far as to connect with recruiting companies by impersonating candidates to get competitive information about real jobs the company is recruiting for. In some cases, the scammers impersonate real employees and request the company change direct deposit bank account information to pocket the money. “We've had to put (in) tremendous amounts of protection,” said Mr. McCoy, speaking of Skywalk Group. “We've had to change our email system, even with how emails that are coming in externally are flagged…we've also done a tremendous amount of development and training of our employee base on how to spot fake emails and phishing campaigns.”

Likely targets

According to the BBB study, the largest group of reports were from those 25-34, accounting for 28.2% of the BBB Scam Tracker reports, followed by those 35-44, with 21% of reports. Mr. McCoy said the younger workforce – between ages 18-25 – can also be “more susceptible (to job scams) due to their limited experience in navigating the job market.” One young job seeker learned about job scams the hard way.

Liz Schultz, a second-year Kirkwood Community College student majoring in journalism and mass communication, said shortly after she launched her LinkedIn account last February, a scammer posing as a recruiter reached out to her. The recruiter had multiple mutual connections and offered a large amount of money to Ms. Schultz to market cutlery, claiming it was salary-based. The company website seemed legitimate, and because he seemed well-known due to their mutual connections, Ms. Schultz agreed to a Zoom interview. Ms. Schultz said the interview was “weird” – cameras were turned off and the interviewer did not respond to verbal questions, only answering in the chat box. Responses via text message seemed automatic and generated, and when Ms. Schultz was slow to respond, the recruiter would ask, “are you still there?” When he demanded her email address, ZIP code, school email and phone number, she grew suspicious and did some investigating to see if the job offer was a scam. “It was difficult to determine if the company was real or not, since it was remote,” said Ms. Schultz. When she discovered the job opportunity was not real, she removed the scammer as a connection. Today, she is a little more wary of virtual job offers. “This certainly makes me feel skeptical that there are a lot of scams going on, and that if a company does do a really good job of masking that they are not real, that someone could certainly fall for that and give them their personal information,” she said. Moving forward, “I think that now it's a little bit easier to spot what is real versus what isn't.” Ms. Schultz has some advice for other college students new to the job market. “I would say certainly be wary of who you are in contact with and do your research. Make sure they (company) has an actual website, that this is an actual person. If you are emailing them, it is important to see if they're local or if they're not local. And if they are local, see if there's a public place you can meet them – at their company site, if that's an option.”

Types of scams

Job scams are as varied as they are omnipresent. According to the BBB, there are several types of scams currently operating, aside from remote offers:

• Reshipping – scammers enlist people to receive the ordered goods, repackage them and send them out of the country, and the worker is never paid.
• Fake checks – checks aren’t widely used anymore, but many scammers use editing software to create business checks that look like the real thing. When the victim tries to cash it, the check bounces and funds are deducted from their account.
• Secret shoppers - victims receive fake checks they deposit into the account and are told to wire transfer part of the money from the received check, write up a report on their experience at the store, and keep the rest. This can also take the form of gift cards; after purchasing the gift cards with promises of compensation, victims send the gift card number to the scammer.

Who are these people?

An in-depth study of reshipping scams found that most goods purchased with stolen credit cards were shipped to Russia. According to the BBB, “the evidence suggests that many of these scams are operated from Eastern Europe. Many fake check scams originate in Nigeria, and are a hallmark of organized criminal gangs operated from there.” “The way that most people are getting scammed right now are from big, very sophisticated, well-funded, international organizations that are targeting people who live in the United States,” said Mr. Coleman. “They target people in the United States because we have a high quality of living,” also noting that foreign scammers are immune to American laws, which makes it difficult to crack down on them. The Better Business Bureau experienced scammers attempting to hack into companies' data to steal information on their customers. “We had one situation where we had a small RV company in the center of Iowa, and their A-plus BBB accredited report got hit over eight million times in one hour from an IP address in Pakistan,” said Mr. Coleman, noting that the hackers were ultimately unsuccessful. “It’s relentless,” he said, “it just keeps piling up…their investment and all this technology keeps paying off because Americans keep making mistakes."

Protecting yourself

The best way to avoid job scams, according to Mr. Coleman and Mr. McCoy, is to conduct your own research before accepting a job offer. “There is nothing wrong with you reaching out to the company directly using contact information you know is legitimate,” said Mr. McCoy. Be cautious of any job that requires the applicant to make a payment up front for training, background checks or other services. “No legitimate job is ever going to send you a check for you to deposit before you start working. That's just not going to happen,” said Mr. McCoy, a sentiment echoed by Mr. Coleman. “If any job opportunity comes with an application fee, where you have to buy in some reasonable fee to get started to get this job…(that’s) a red flag,” he said. Other precautions job seekers can take is to use secure communication channels and avoid sharing personal information early on in the hiring process, and being wary of job offers you're unqualified for, especially if the recruiter makes an offer after a single interview and it's a relatively high-paying job. “The likelihood of that happening is very, very small,” said Mr. McCoy. There are some common denominators among scammers that job seekers can also look for: Bad grammar, spelling, and formatting issues with communication; email headers different from an email address, and being pushy with the process. “Sometimes the recruiting process for many companies is not that proficient. So, if you are moving through a process extremely quickly, that to me would be an indication that maybe I want to just take back and make sure that this is really legitimate,” said Mr. McCoy. If the worst-case scenario happens and a scammer obtains access to personal and bank information, the best thing to do is immediately contact your bank. “No matter how you paid — debit or credit card, mobile payment app or wire transfer, gift card, cash reload card, or cryptocurrency — immediately contact the company you used to send the money, report the fraud, and ask to have the transaction reversed, if possible,” the FTC advises. In addition, victims should change passwords and cancel credit cards, if applicable, and monitor their credit and report the fraud to the FTC and BBB.

Give me an ‘S’

Mr. Coleman said job seekers should pay attention to a company’s URL. “You want to make sure that you're only interacting with websites that have an “s” in the “https,” he said. The last letter is significant because it means the address has earned a security level on the internet. Many legitimate companies also have a padlock icon on the other side of the URL.

BBB adapts to changing world

Once upon a time, the BBB focused on helping consumers get refunds from local businesses that did not follow through on commitments, but these days efforts have refocused to the prevention of international scams. “The Better Business Bureau has shifted a lot of our efforts to try and not just help people who have been scammed, but spending more time trying to warn people to avoid scams…(we don’t want to be) just be the place where people go after they've been scammed,” he said. Of the scammers, he said “We sure wish all those really brilliant people had used their talents to solve some of the world's problems instead of creating new problems for us.” If you think you have been a victim of a job scam or have been contacted by a potential scammer, report it to the BBB and FTC.