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If you’ve ever thought about starting an online business, being your own boss, or earning a living from investing, you’re not alone. But many people looking for ways to earn money are finding scams disguised as legitimate business offers, coaching programs, and investment opportunities.

Examples of Business Offer Scams and Coaching Scams

How can you tell if a business offer or coaching program is a scam? If it promises guaranteed income, large returns, or a “proven system,” it’s likely a scam. Even a free or low-cost “system” to get your business started can quickly turn into a money pit — costing you tens of thousands of dollars for mentoring or other services that promise to increase your business’s success but leave you deep in debt instead.
Here are a few examples:

Online business coaching

In this type of scheme, the promoters typically claim you can make big money with little or no experience. They say their “experts” will teach you a “proven method” for building a successful business on the Internet. Many say or suggest that they’re affiliated with well-known online sellers when that’s not true, or say things like:
  • “You can make 5-6 figures if you follow our system.” But that doesn't happen.
  • “Learn from the experts how to generate income.” But that is a false promise.
  • “You can be making money now. Guaranteed!” But no one can guarantee that you'll make money in business.
  • "Our students make between 50% to 100% return on their investment in the first year." But these are nothing but made-up numbers.
The scammers make it sound like it’s easy to set up an online business and make money, and say that, for a fee, they can show you how to do it. While enticing, it's not true. Hundreds of thousands have learned this the hard way after losing thousands of dollars to scammers for bogus business coaching services that left them with nothing but debt and broken dreams.

Real estate seminar and investment coaching scams

Promoters of these schemes often lure people in with free live or online seminars where so-called real estate investment or securities trading “experts” talk up their impressive track record and the success of their “students.” The energetic atmosphere makes it seem like a great way to learn how to make life-changing money. Such schemes routinely use made-up “stories” and statistics, claim a guaranteed return on your investment, or stress how cutting-edge their offer is. They’ll often try to rush you into making a quick decision to buy in.
If you do sign up, you're likely to find that what you paid for is worthless and your money is gone. Read Real Estate and Investment Scams for more on real estate investment seminar scams and investment coaching scams, and how to spot them.

Pyramid schemes

The promoters of a pyramid scheme typically try to recruit you with pitches about what you’ll earn. They may say you can change your life — quit your job and even get rich — by selling the company’s products and getting others to join the enterprise. But if the real focus is on recruiting others, not on selling the company's products, that business offer is a scam. Pyramid schemes are set up to encourage recruitment to keep a constant stream of new distributors — and their money — flowing into the business.
Pyramid schemes can look remarkably like legitimate multi-level marketing business opportunities. But if you become a distributor for a pyramid scheme, you’ll be involved in a scam that can cost you and your recruits — often your family and friends — substantial time and money. People who become involved in pyramid schemes typically lose everything they invest, and some also end up deeply in debt. Read Multi-Level Marketing Businesses and Pyramid Schemes to learn more.

How to Avoid Business Offer and Coaching Scams

Before you pay for a business opportunity or coaching program:
  • Take your time and talk to someone you trust. Scammers will try to pressure you to get involved now or risk losing out. Get a second opinion about the business offer or coaching program from someone who has your best interests in mind. Talk to someone you trust — a friend, a family member, a neighbor — before you sign up. Talking about it could help you realize it's a scam.
  • Do some research. Search online for the name of the company and words like “review,” “scam,” or “complaint.” Check with your state attorney general for complaints. No complaints? It doesn’t guarantee that a company is honest, but complaints can tip you off to possible problems.
  • Read success stories and testimonials with skepticism. They might not be true or typical. Glowing stories of success could be fake or misleading, and positive online reviews may have come from made-up profiles.
  • Check out your coach’s credentials. There’s no licensing requirement to become a business coach, but there are some certification programs. Business coaching scammers often lie about their credentials. Do some online research about the type of certification your business “coach” says she has, and even talk to some former or current students about their experiences with the business coaching program.
  • Be ready for the upsell. If the business promoter or coach asks you to pay even more money to help your business succeed, stop. Hang up. Then take time to talk with someone you trust. Consider the details of the offer. Many of these offers are scams, especially when the caller pressures you to make a quick decision.

What To Do Before You Join a Coaching Program or Buy a Business Opportunity

Anyone who sells honest business opportunities should give you detailed information. Sit down and ask yourself some very specific questions, like:
  • What would I be selling or doing?
  • How and why would shoppers find and use my website?
  • How would the business generate income?
  • What would my specific expenses be? Can I afford it?
  • When would I expect to turn a profit?
Get clear answers to these questions before you consider paying for any business opportunity, no matter how good it sounds. And don’t believe sellers who claim you don’t need to understand the details of the business because “it’s the internet,” “it’s a turnkey system,” or because their supposed experts, coaches, or mentors will “take care of everything for you.” Profitable “turnkey” businesses are rare, at best.
Scammers want you to give up your credit card or bank account information first and ask questions later. They know that if you do some research, you might find reports of rip-offs and back out of the deal. Indeed, a quick internet search often is enough to show you alarming complaints. Honest business opportunities don’t need to use high-pressure sales tactics — an offer that’s good today should be good tomorrow, too.

Report Fraud

If you suspect a business offer or coaching program is a scam
You may be able to get legitimate business development advice and counseling through agencies like the Small Business Administration and its SCORE program.