There are so many legit ways to make money online and it’s true that virtually anyone can start a business on the internet. It’s much easier than it was even 10 years ago, but that doesn’t mean you won’t have to put consistent effort into building and growing your business.
Online business scams often feed on your desire for fast, easy money. However, it does take time and effort to build a business online, just like it does offline. If anyone tells you any differently, run in the other direction.
Most people know they should put their guard up when they encounter ‘get rich quick’ schemes, but scammers know that too. Many do everything they can to appear legit. They know that most people who are interested in their “offer” don’t know much about starting a business online and they take advantage of that. They often try to make it look easy without actually saying it is.
How to Spot a “Start an Online Business” Scam
The following tips will help you identify which online opportunities are legit and which ones need to be investigated further to verify their legitimacy.
1. Can you easily contact the company? When you do, will they answer your questions or use sales tactics to steer you away from your concerns? Ask tough questions and only accept straight answers.
2. Elusive businesses with tons of hype are always a red flag. They don’t offer a lot of (or any) information about the company you’ll be dealing with (or even what exactly you’ll be doing), but OH the money you can make! It quite often starts by getting you to sign up for a webinar or offline event and/or a promise to reveal an amazing ‘system’. They specialize in getting you all pumped up to a point where you’re so busy focusing on all the easy money you’ll make, you won’t notice you’re being swallowed by a scam.
3. The same goes for ads. If you see an ad in a Facebook group or elsewhere that doesn’t state what the business is and how they earn money, ignore it.
4. Cookie cutter websites and turnkey systems that set you up with a basic site that you can use to start an online business. They usually promise to do everything for you, all you have to do is pay them and abracadabra! You’re a money-making machine. You’ll pay more than you would if you set it up yourself and you’ll get a lot less. There are legitimate services that set you up online and make it easier for you to get started and operate, like ecommerce platforms. It’s a good indication you should dig deeper though.
5. If they ask for money to join an ‘affiliate program’, chances are you’re going for an expensive ride. Legitimate affiliate programs don’t charge you money for the dubious privilege of promoting their product or service. You’ll quite often find shady tactics in the terms of ‘affiliate programs’ too. I just found one of those recently. The terms included a payment threshold, which isn’t unusual. The trick was, if you didn’t meet the payment threshold in a few months, they’d take whatever amount of money you did manage to make. That’s not an incentive, it’s theft. If they don’t like your performance, they should remove you from the program and pay out what they owe you.
6. Thinly-disguised MLM (Multi-Level Marketing), ponzi or pyramid schemes will push recruiting people over the sales of products or legitimate services. There’s nothing wrong with building a downline (team), but it shouldn’t be the primary income generator. There are compensation and sales strategies that resemble MLM, but aren’t considered as such by law. If it appeals to you, it’s fine to join after careful vetting. Even legitimate affiliate programs can look like MLM, but it’s just a method of compensation based on sales commissions.
“When operating within the limits set by the Competition Act, multi-level marketing is a legal business activity with set responsibilities for both operators and participants,” states the Competition Bureau. “However, pyramid schemes are illegal multi-level marketing plans that require purchases for participation, compensation for recruitment, inventory loading, or the lack of a buy-back guarantee on reasonable terms.”
7. Income claims featuring ‘real people’ who have made a fortune. It isn’t unusual for a select few to make a ton of money with schemes, but that certainly doesn’t mean you will too.
8. “All you have to do is recruit five people and you’ve paid for the program.” That may be true, technically, but it’s a good indication that they’re focused more on recruiting than selling a product and that rarely ends well.
9. Easy money rarely exists in legitimate businesses. If you see ads such as “Make $$$ posting ads on Facebook”, filling out forms, searching the internet, or other promises of easy money, it’s likely a scam.
10. Training, membership sites, conventions or any other ongoing ‘investment’, should have you on high alert. There are many legitimate membership sites, training programs and events, but when combined with other warning signs you should keep your wits about you.
11. Pressure tactics that try to get you to ‘buy now’ or lose out in some way. Urgency and scarcity are legitimate marketing tactics. However, if you feel pressured to buy in before you’re ready and don’t have time to properly research the opportunity, don’t do it.
12. Low quality or stolen content can tell you a lot about any site (and the people who own it). You can often pick up on it when you read it, because it won’t flow as it should from a writer with actual expertise on the topic. These ‘experts’ simply run around the internet copying information. They’ll usually attempt to reword it (typically using software), which can result in some laughable inaccuracies. If they lack the expertise and experience to create their own high-quality content, they’re not someone you should be taking advice (or buying products) from.
The Consequences of Online Business Scams
- Obviously, you’ll lose money and may damage your reputation.
- Google knows about scams and the minute they associate you with one, you’re doomed to fail. The same applies to email service providers, who can block IP addresses or keywords and send your emails straight to a spam folder or block it before it reaches the intended recipient.
- It’s entirely possible that the ‘program’ is illegal in Canada. If you’re actively recruiting others to sign up for a pyramid scheme, for example, you’re breaking the law. The punishment is severe, with hundreds of thousands of dollars in fines. If you’re convicted of fraud, you’ll probably end up incarcerated as well.
Success is the Best Revenge
The saddest part of scams isn’t the money people lose, it’s that they may never try again. If you’ve been scammed by an online business scheme, don’t give up! There has never been more legit opportunities to make money online than there is right now. You’ve learned a valuable lesson that will help you find them.
Please share your experience or questions in the comments below, or join us in the Online Business Canada Facebook group.
Related Reading
10 Low-Cost, Part-Time Businesses you can Start Online from Home
Checklist: How to Start a Profitable Online Business in Canada
For weekly inspiration, insights, tips, and resources, sign up for the Online Business Canada newsletter!
7 Recession Proof Online Businesses To Start From Home
Expert help to choose, start, and run a successful online business!
“Almost 200 pages of pure gold…”
GET IT ON AMAZON
Or Other Major Ebook Retailers
——————————————
© CanadiansInternet.com – Content on this website may not be used elsewhere without expressed permission. Thank you for respecting the effort that we have put into our original content.
DISCLOSURE: We may receive compensation for links to products on this website. As an Amazon Associate, we earn from qualifying purchases. Our content is provided for informational purposes only and does not guarantee results.
Marie has an M.Sc. in Marketing and a certificate from the Ryerson Digital Media program. She's enrolled in one course or another most of the time and is always in the middle of a new business book (or three). Marie enjoys writing, traveling and volunteering at local events & trade shows.
There’s so many online business scams I haven’t done much to start one because I’m paralyzed with fear. Even choosing freelancers is hit or miss and I’ve heard stories of some of them ripping people off by taking the money and ghosting. Is there a site that names the scams and scammers so we know who and what to avoid? If not maybe that could be my niche LOL.
You have to watch for scammers everywhere you go online these days and on the phone too. I just got an email about registering my domain in other countries. They use scare tactics so you panic and register. I wish they’d get real jobs. 🙁
I wish I saw this article before I was lured to join in that scam. I had a doubt actually beforehand that they are scamming people the way they advertised. But I joined anyway because I was so intrigued to know what is happening inside, why this group is thriving everyday, why despite of so many bad reviews I have read, they still continue to operate and advertise actively in social especially in FB. Why the government is allowing them to victimized so many people. So the was thinking what if that biz is good, and they just don’t know how to do it “accordingly”. So in the hopes that I can make my own course, and correct whatever is wrong, I joined. They are teaching their new recruits how to avoid being banned in FB, answering to inquiries are majority a copy paste, a readily made answers from the old one’s and their strategies how to increase recruits is all about lying. I did not listen of course because how in the earth you can take that. But unfortunately telling the truth to people is not allowed. So I got away, but I lost my hard-earned savings.
I should have read this post before I signed up for that $149 sign up. Sigh. I knew it was too good to be true. I did follow the program and when asked to purchase those expensive water products I knew it. A Big Scam. The 30-day refund policy is a BS. I never heard from them anymore.
After reading this article, it’s as if you directly were talking about the “webinar” I was just asked to watch by a friend who is a part of a very “successful online digital business” every point made in this article is exactly what I just experienced, it actually just made me laugh.
It’s just sad that so many people buy into this garbage.
there has been a revieuw about Digital business program in Reddit
https://www.reddit.com/r/antiMLM/comments/dzjv1b/what_is_this_digital_business_scam_ive_been/
I was just about to give in and send money to this folks and pay 490 $ for their course when i dicided to do some forehand research. Among other things on the internet i bumped on the reddit article above.
And than the red flags started to pop up.
For example: there are dozens and dozens of testimonies from satisfied clients, who are so happy the
at they quitted their job, got more money and more time, sales goes on day and night, more freedom and indeendence and bla bla bla on and on. Yeah. Right. BUT:
Nobody actually saiys WHAT their bussiness is, WHAT do they sell, where, what products ? Bizar.
Also, from nobody i get a cear name or reference, or b
location. It all stays very vague.
Also, the Digital Bussiness program has no website, no names, no references at all. That is very suspicious.
So i decided to keep that 460 $ in my pocket , its about 4 weeks of groceries for me.
There should be more effort to catch & charge scammers of all kinds. So many good people lose money to them. 🙁
It’s the scariest part of starting an online business and thanks for the tips! I almsot got taken by one but I asked around about it. The first clue was a bunch of people started pushing a webinar on sites that all looked almost exactly alike (cookie cutter?). It looked like a disguised MLM of some kind. Watch out everyone!
Is it the that they ask you to pay $149 then after attending the webinar you book a “coaching call” where you are asked to start the business by buying some products of about $10,000 if you want to start making a commission of $1,400 on every sale?
Yes. That is a scam! They tell lies or overly hype post of events to people for them, so those people are encouraged to join. When people join, they then required to buy a very pricey water machine and products with very little value hoping that they will earn a big amount as well and become rich, the way they made believe. Once someone joined, scammers will then make money. Then they will teach their recruits to scam people as well for both of them to make money. And the chain continues. It just so sad that this scam activity of those people continue to live and continue ripping off others hard-earned money. This has become already a global wide. I just hope that every government of every country will take action on this especially in Canada. Lots of scammers nowadys. Think they dominated FB already as mosf of them advertised on FB but they don’t mention company’s name nor the products
Thank God i stumbled on this testimonies. I was just about to be taken as well and just today. Exactly what was described on above matches my experiences. I was told to pay $149 after they sent me a link to watch webinars full of testimonies from diversified group of ethnicity claiming how they quit their jobs, bought a house bla bla bla. I was so curious especially for someone like me that was duped with thousand of dollars couple of years ago. Am glad i have fall for this one. Stay safe and be awoke ppl.
Very informative! Thanks for sharing!
Hi . Very informative.
I am interested in in opening online business in Canada . Please guide me in how to start that .
Regards
Rishi Raj Singh
This post will point you in the right direction: Checklist: How to Start a Profitable Online Business in Canada