For Release: June 20, 1996
Caution: There may be no job behind that classified newspaper ad. So says the Federal Trade Commission, which today announced charges against nine companies and 16 individuals the agency says were engaged in the fraudulent marketing of employment services for up-front fees of $35 to hundreds of dollars. The FTC said the seven schemes run by these defendants start with the placement of classified advertisements in the employment sections of newspapers nationwide touting positions such as “financial analyst,” “engineering” and “government positions.” When consumers call the numbers in the ads, telemarketers hype themselves as job placement services with special access to specific job openings. Few, if any, consumers ever receive the type of job placement assistance promised by these scam artists, and the vast majority of consumers never see their money again. The red flag, the FTC said, is that they charge up-front fees coupled with refund guarantees or require credit card or bank account information with a promise that no immediate charges or debits will occur.
“It’s not just the entry-level worker that is targeted by these fraudulent job-finding services. Mid-level professionals often fork over hundreds of dollars, and get virtually nothing of any value in return,” said Jodie Bernstein, Director of the FTC’s Bureau of Consumer Protection. “Our advice to consumers is: make sure you’ve got the job before you pay. If a job locator firm promises you work, but asks for money up front, check their contract carefully before you sign. If the written refund policy doesn’t match what the telemarketer told you, the firm is operating illegally.”
“Some fraudulent firms lie to consumers to get them to divulge their bank or credit card account numbers, and then debit or charge their accounts without authorization,” Bernstein warned, adding: “Some legitimate firms charge advance fees for executive counseling, resume writing and job listing services. But they’re selling information, not promising you a job. Never give out your bank or credit account information unless you know the company you’re dealing with and intend for your account to be accessed.” The FTC suggested that consumers who suspect they’ve had dealings with a fraudulent employment services firm report the company to the National Fraud Information Center’s Telemarketing Fraud Hotline at 1-800-876-7060.
The FTC also announced a consumer education campaign to help job hunters avoid employment services scams. As part of the campaign, the FTC will distribute its new brochure “Help Wanted . . . Finding a Job” and consumer “tip” card through major human resources organizations such as the Recruiters Online Network, the National Association of Colleges and Employers, the Society of Human Resource Management, the National Association of Temporary Services, and the National Association of Personnel Services. Several of these organizations have committed to carrying public service messages on their Web sites that will link consumers back to the FTC’s new consumer information on job scams. The FTC Web site is http://www.ftc.gov
In the cases announced today, the FTC filed charges in federal district courts in California, Florida, Georgia, Michigan and Massachusetts. Two of the actions remain under seal by court orders. The defendants in the cases and some of the allegations are as follows:
In each case, the FTC is seeking a court order permanently barring the challenged practices and ordering the defendants to pay redress for injured consumers. Hearings on the FTC’s motions for preliminary injunctions pending the outcome of trials in the cases are being scheduled.
The FTC received significant assistance in these actions from the Santa Barbara District Attorney’s Office; Georgia Governor’s Office of Consumer Affairs; the Georgia Secretary of State’s Office; the Cobb County, Georgia, Sheriff’s Department; the Massachusetts Attorney General’s Office; the Florida Attorney General’s Division of Economic Crimes; the Orange County, Florida, Sheriff’s Department; the Winter Park, Florida, Police Department; the U.S. Postal Service; the U.S. Office of Personnel Management; the Better Business Bureaus in Boston and Central Florida; and the Crystal River, Florida, Police Department.
The FTC vote to file the complaints detailing the charges in these cases was 5-0.
NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. The case will be decided by the court.
Copies of the FTC’s consumer brochure, titled “Help Wanted . . . . Finding a Job,” as well as the complaints in these cases, are available from the FTC’s Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710. FTC news releases and other materials also are available on the Internet at the FTC’s World Wide Web site at: http://www.ftc.gov
FTC File Nos./Civil Action Nos.:
Direct Link, FTC File No. 962 3084/U.S. District Court for the District of Massachusetts, CIV No. 96-11239WGY
Stratified Advertising and Marketing, File No. 962 3153/U.S. District Court for the Central District of California, in Los Angeles, Civil Action No. 96-4142 (VAPx)
Regency Services, FTC File No. 9623127/U.S. District Court for the Middle District of Florida, Orlando Division, Civil Action No. 96-643-CIV-ORL-22
Metro Data, FTC File No. 962 3125/U.S. District Court for the Middle District of Florida, Orlando Division, Civil Action No. 96-641-CIV-ORL-22
Career Information Services, FTC File No. 962 3205/U.S. District Court for the Northern District of Georgia, Atlanta Division, Civil Action No. 1 96-CV1464-ODL
and two cases still under seal