Business Opportunity Fraud Explained By NYC Defense Lawyer
Many people are looking for business opportunities to help them earn a living, especially if the opportunities allow them to work from home. When offering jobs and work opportunities, however, it is important to be upfront about the terms and conditions of employment in order to avoid being accused of fraud. A fraud accusation could lead to an investigation and could result in state or even federal criminal charges.
If you find yourself under investigation or under arrest for business opportunity fraud, you need to speak with a legal professional who can help you fight charges. Bukh Law Firm, PLLC has provided legal representation to many individuals and organizations accused of orchestrating or operating business opportunity scams. Our attorneys can provide guidance and legal advice on how to respond to accusations, how to protect your rights during a criminal investigation, and how to deal proactively with criminal charges. Contact us today to learn more.
What is Business Opportunity Fraud?
Business opportunity fraud involves “selling consumers bogus promises of jobs, government grant, or some other money-making opportunities.” The Federal Trade Commission indicates that the agency has cracked down on business opportunity scams in recent years, especially those scams that have targeted the unemployed and that have targeted those struggling with financial problems.
In an effort to prevent business opportunity scams, the FTC has strict rules in place for any individual or any business that is advertising a work, job, or money-making opportunity. Business Opportunity Rule 16 CFR Part 437 stipulates certain disclosures that must be made when selling any type of investment or job opportunity to consumers.
The disclosures require the seller of the business to be identified, and to state whether claims are being made related to the potential earnings the opportunity could provide. A list of references must be included, and disclosures must detail whether any company personnel is the target of legal actions. When statements related to earnings are made, those offering the opportunity must provide an additional Earning Claim Statements that includes details on who is making the earnings claim, the period of time it took to earn the claimed amount, and the percentage of people who earned either the claimed amount or more.
The business disclosures mandated by the Business Opportunity Rule must be on one page, while the Earning Claim Statements must be included separately. All disclosures must be provided at least seven days before any money is collected from someone seeking to take advantage of a business opportunity, or at least seven days before any contract is signed.
When disclosures are not made or are not accurate, this can result in accusations of business opportunity fraud.
What are Common Types of Business Opportunity Fraud?
Business opportunity fraud can take many different forms. Some of the most common examples include:
- Career opportunity scams: This type of scam generally involves advertising career opportunities in exchange for a fee. In many cases, these types of scams involve the promise of access to government job opportunities at the state or federal level. Mystery shopper scams also fall within this category of business opportunity fraud. Consumers are told they’ll be paid for going to stores and restaurants, but they must pay a fee to sign up for the mystery shopper service. In February of 2014, the FTC shut down one of these business opportunity scams allegedly being run by Shopper Systems, LLC.
- Work from Home Scams: Work at home scams promise that it is possible to earn income (and sometimes significant amounts of money) by doing various work tasks from home. There are dozens of different work-at-home scams including rebate processing, envelope stuffing, medical billing, and rebate processing.
- Reshipping scams: Re-shipping scams are a specific type of work-from-home scam. The job offer promises you can work from home by receiving packages and mailing them (often to foreign addresses) using postage-paid mailing labels. The merchandise that is being reshipped is usually bought with stolen credit cards.
- Money muling: Money mules transfer stolen money. In money muling scams, people are tricked into transferring the money through the use of online job ads. This occurs in different ways, including asking “employees” to open a bank account, provide account information, receive wired money, and re-send some or all of the wired money through a money transfer service. The wire is fraudulent and the money mule can be held financially responsible.
These are a few examples of common types of business opportunity scams. Certain types of investment scams can also be considered business opportunity fraud.
Penalties for Business Opportunity Scams
Anyone who is accused of falsely advertising a business opportunity or of providing misleading information about a potential business opportunity could be charged with various state and federal crimes. Examples of possible charges you could face if you are accused of any involvement with business opportunity scams include:
- Wire fraud under 18 U.S. Code Section 1343.
- Mail fraud under 18 U.S. Code Section 1341.
- Computer Fraud and Abuse Crimes under 18 U.S. Code Section 1030.
- Other federal fraud offenses found in 18 U.S. Code Chapter 63.
- Fraud crimes under Article 190 of the New York Penal Code.
Federal fraud crimes can result in penalties including decades of imprisonment. It is possible to be charged with multiple criminal counts when accused of business opportunity fraud. You may also be required to make restitution or repay funds acquired through the offer of misleading business or investment opportunities .
How a NYC Fraud Defense Lawyer Can Help You
Fighting charges related to business opportunity scams requires you to understand what laws apply to your case and to make informed choices about how best to respond to the serious accusations being made against you. Contact Bukh Law Firm, PLLC to learn more about how a New York City criminal defense attorney can provide you with the assistance you need to deal proactively with accusations that you were involved with the offer of fraudulent business opportunities. Our attorneys can represent you in trial after a not guilty plea or can work with the prosecutor to try to negotiate a plea deal that results in the minimal penalties and consequences for a serious charge. Get the help you need today when you are facing fraud charges.
