What I learned on the way to a(some) fleecing(s)
Column first posted on 20081201

Times are tough and we’re coming up on Christmas, which can be a time when temptations are high to invest in activities that promise to bring in a healthier amount of the legal tender.  I’m offering this column as a public service to readers who may be so tempted, hoping they’ll profit from my own missteps in the newfangled world of “online businesses.”

Experience keeps a dear school, but a fool will learn in no other.
— Ben Franklin

Rule #1:

Don’t send money to anyone who tells you “how to make money on the Web.”
(That’s how he makes money on the Web, not you.)

You have a computer and a fast connection to the Internet.  That’s great: it puts you right there with about a billion people on the planet.  But you can type and read and write English fluently, and you’re okay with strictly an American market.  So to leverage your computer into a home business, that cuts down the potential competition to maybe 50,000,000.

Our 50 million may be off by several million or even wrong by an order of magnitude.  But basically with the annual growth, penetration, and technical development of fast-Internet proceeding at warp speed, you can be sure the pool of World Wide Web users—whether customers or suppliers of services—is unbelievably enormous, even if only in North America.  If you’re an honest, hardworking person, you may be thinking:

“Wow, that’s so many potential customers, I should be able put up a site selling official virtual moon rocks for $1 apiece and easily make $100 a day.  Who’s greedy?  I can quit my crummy 9 to 5, and never worry again about being laid off in this sucky economy. Surely, two people out of every million will plop down a buck, maybe more, for an officially certified rock.  With a little time and some sophisticated promotion, I’ll bet I can turn that $100 a day into $200.  My wife can quit driving school busses; we’ll spend more quality time together and with the kids, and we can still afford their piano lessons and quality hockey time.”

Except for the fact that I don’t have a wife and kids, I completely grok where you would be coming from.  Times are tough, people do make money on the Web, and the bricks and mortar economy is scary. I have nibbled at a fair number of Web moneymaker lures, and gotten hooked several times.  I was naive.  Every one of the opportunities I tried was, if not a fullfledged scam, then “all things of and pertaining to scamdom.”

What I fundamentally failed to appreciate:

• While honest, productive people look at a pool of 50 million people as potential legitimate customers, a con artist sees 50 million marks.
• There are LOTS of con artists out there, especially on the Web.

So that’s my first lesson.

Rule #2:

Pay close attention to the “Rule of David Hannum.”[1]

Yes, he’s the one who actually said, “There’s a sucker born every minute.” (It’s an interesting story in mid-19th century American life, and yes PT Barnum is part of the story.)  The point is the saying, not who said it.  An unfortunate and influential, though relatively small, number of individuals have a defect in their psychology that causes them to seek unearned wealth from others through deception.[2]  They prey mainly on the gullible who seek a way out of uncomfortable material circumstances—often with pitches that appeal to one’s better nature, e.g. financial independence, working diligently, or taking pride in what you do.

Though sometimes greed factors in.  In the Internet scams I’ve run across though, they tend to draw you in with assurances of modest income in the $1000/week realm for “part time” work.  Nowadays, $1000 a week sounds like a fortune to many citizens, so no doubt thousands take the bait and sign up.  Further, the fees for participating in the business are almost always something like $39.95 (which is half price for joining this month) to get it going, and a manageable monthly fee of about $10 for ancillary services such as email and a Website. To the average naive Joe, the fees are negligible compared to an assured $1000/week income.

Gentle readers, remember this adage “there’s a sucker born every minute.”  The Web ‘sucker baiters’ know it’s true—or at least has been true for quite some time—and thus they have a predictable source of innocents to clip virtually unchecked. (The Internet has yet to develop any meaningful Better Business Bureau or Consumer Reports self-policing, much less any realistic legal prosecution standards for online fraud.  I’ll discuss this later.)  So it’s just you and your computer and an offer that looks like Fat City coming to breakfast.

So: don’t be a sucker (Rule #2) and don’t open up your credit card[3] to anyone who tells you by doing so you can earn a thousand dollars a week (Rule #1).

Rule #3:

[If you’re a guy… and mostly it’s guys who want to get rich quick] get or stay married to a good woman who knows how to conserve and manage money… and do what she says.

Well this is obviously for the guys out there, but you can apply it to most couples regardless of gender or sexual orientation.  As a practical matter, men are probably more prone to fall for business cons, while women are generally more wary (because they’re used to dealing with baloney from men).  At least that’s been my experience.  In my own case, there would be no way my ex would ever go for any business idea unless it was checked out twelve ways from Sunday.  If you’re not married and are considering some scheme, then get some advice from a woman friend, then even a second female opinion.  Talk to your mother.  Believe me, you’ll save a lot of money for the important things, like golf and beer.

Since some of my male readers may not have the option to get the fairer gender review their “get rich—or reasonably well off—quick” notions, I’m going to describe three or four specific online moneymaker prospects that yours truly fell for.  I’m not going to call them scams, but I will tell you my experience and you can judge for yourself:

1. Freelance Work Exchange—This Go Freelance operation seemed like such a natural for a freelance technical writer like me, and I signed up back in late ’07.  How could I miss?  You pay $7 for a seven-day free trial, then it’s $49.95 a month thereafter.  It’s a very well designed, even elaborate Website; you think, “Wow, this must have been put together by some true professionals.”I hung in there for about two months, which is two months longer than I should have. There were indeed freelance jobs posted for writers, editors, word processors, and what have you.  But I didn’t receive a single offer. Many of the postings wanted you to write 50-page technical documents for maybe $5 total and I guess the privilege of seeing your work published.  And I didn’t get a single response from the posting of my resume, not one.  And it’s a decent resume. Eventually it dawned on me something was awry, then I read later Web info that these guys were a scamfest.
2. Consumers Discount Rx—The experience with Go Freelance soured me, and ironically I was getting some freelance techwriting from conventional connections.  But in a lull, I decided to Google “online business” just to see what would come up.  I was drawn to this come-on page from Consumers Best Buy.  What I liked about CDRx was that it had a fairly detailed, conscientious process for setting up and generating what are called CPC ads (click ads); I mean they weren’t trying to tell you that you didn’t have to do any work.So I believed that if I followed their process for writing ads and getting them approved, I’d see some action. The products are brand name mainstream drugs, chiefly Viagra and the other boner pills, with a handful of other popular drugs such Propecia (hair loss), antidepressants, and diet pills. You buy a Website from CDRx. Drug prices are much higher than you get offshore, but a little bit less than from a doctor’s prescription.  (CDRx tries to scare you that buying offshore is illegal.)As I say, I had high hopes and put a lot of effort into getting the CPC ads just right. I even mentioned to my industrious nephew that I was getting into this online business that looked legit, and I’d let him know when I started making money. I received more than 2,000 visits to my site between June ’08 and September ’08, and NOT ONE SINGLE ORDER.  These were targeted ads, with pricing information already in them, to deter site visits from those who sought lower prices.  I called customer service—which was always one defensive guy named Jeff, as I recall (but he seemed reluctant to give me his name)—several times, and he would suggest I continue to tweak the wording. “How about if you send me an ad that works for someone else?” I’d email.  “Nope, if we gave you an ad and it didn’t work, you’d blame us,” they’d respond.So, again it became clear there was something fishy here. I bailed… but didn’t get my money back, because I waited past the 60-day period (in which they guarantee $1000/week).  Oh, there was one other thing about these guys that hooked me in the beginning: they send you to a Colorado Secretary of State Webpage, that verifies they are a business with a Colorado address in “good standing.” So the government does not call CDRx a scam, except I don’t think anyone makes any money at it.  So much for government regulation of business.  And I bet anything that the testimonials in the come-on page are shams; if anyone can prove otherwise, I’m all ears.
3. Paid Survey Plan—I learned of this one from Googling to a small page entitled Dave’s Scam Review.  I had just ended my relationship with CDRx, and I thought to myself, “I really just need to be more thorough; there have to be honest online businesses out there for people like me.”  Dave was reassuring:
   

   I was scammed by 31 different “get rich quick” schemes and I lost over $4800 in 4 months. Everyone of these so called money making programs all said the same thing “they were going to help me make a lot of money with out having any experience”. I was in the position where I had to create an income fast, I had no other choice. Even though I thought most of these programs were probably scams, I tried them anyway because I knew that if just one of these programs worked for me that is all it would take.

   Out of 31 programs 29 were complete scams that just took my money. Only 2 of the programs actually worked. I am going to give you an honest review of the 2 programs that did work for me. Although you might not make money as fast as they say you will, you will make money if you follow their steps. Below is my brutally honest opinion about each program. If you are looking at any other program besides these two you are most likely wasting your time…

   Wow, this must be the right one (or two), because this “just folks” fellow named Dave Williams, whom of course I didn’t know from Adam—there isn’t any contact info for Dave—was having the same experience I had with Internet scams.  Surely, he’s giving me the straight skinny.  It just never occurred to me that maybe, just maybe, the sites he was so heartfully recommending as legit MIGHT HAVE CREATED THE DAVE SITE.  Geez, how could I be so unbelievably dimwitted?!

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   Anyway, I did try the one Dave recommends that is “more conservative,” i.e. the one where “you will make money” doing these surveys for companies.  Paid Survey Plan is basically a list of Websites, probably updated periodically, that send you various email promotions, product evaluation surveys, questionnaires, etc. that you pay ~$39.95 for.  So I set up a new, free Yahoo! email address, and enrolled in the top 10 or 15 of these sites’ survey programs.

   I also purchased a autofill program called Robo-Form—which is actually useful for other repetitive, routine data entry tasks—and used it in much of my form filling.  How could I miss?

   Here’s how: a) about the most you get paid for any response is $1.00 for maybe 30 minutes of your time, b) most of these $1.00-type surveys you answer a few questions and you find you’re not qualified for the survey, c) for surveys that tell you that you’ll make $10, $25, or even $75, you thread through the maze and do a product evaluation that requires you to enter credit-card info committing you to far more (and ongoing) expense than what the survey pays, d) you basically never fit the required profile for any big money-making questionnaire or study group, e) manyf surveys try want you to participate for no consideration… or for prizes or reward points or empty symbolism, and f) for the companies that pay you for reading emails, you get one or two cents per read.

   If anyone finds a survey program where you can make a legitimate $20 hour or more, again I’m all ears.

4. Work from Home Review—One of the other more professional and elaborate online business review sites. Like Dave’s Site, this one despairs about all the scams and points you to online businesses that are supposedly not scams.  By the time I checked the main recommendation out, I had finally become aware that they’re all shysters.  These latest guys are selling riches, too.  Another tipoff is poor writing and grammar, and that “there are only 37 positions remaining, so if you don’t sign up in the next 24 hours you’re out of luck.”  Well, guess what: a month later there are still 37 positions remaining.  Do these guys think I just fell off the banana boat?

On 1-3 above, what basically convinced me to go forward were the testimonials.  You have Karen and Steve and Bill and Shirley, etc., ordinary working people like you and me, using first and last names, sometimes even with a company name following them.  Saying, “Thanks <Answer to My Prayers> Web Business, I’m getting work, receiving big checks, and now my money woes are behind me.”  It never occurred to me that these testimonials were completely fabricated!  But they have to be.  Same with the picture of the check for $4,800.00.

Which gets me to thinking: “Can a company legally present a testimonial of a person having achieved a specific income or specific dollar compensation, when that person and/or validity of the claim is known to be nonexistent/false?” What happens in the brick and mortar world?

Well, you have to believe that those better-known TV infomercials are questionable.  E.g. the claim that Bob and Suzy Homemaker started selling depressed real estate using the Joe Blow Power Formula and after 90 days make thousands a month and vacation every other week in Tahiti.  I don’t hear these companies being charged with fraud, even though I’m pretty sure they’re lying.  Why aren’t these companies prosecuted?  Is it because the police don’t treat fraud as a priority?  I mean whether it’s brick and mortar or cyberspace, if you make a material assertion that you know to be false, and as a consequence of that assertion you obtain money from someone, then you’re a thief.

Just as if you pointed a gun at someone’s head and stole his wallet.

Rule #4:

Ideas for making money on the Web

All right, I need to wrap this up.

Idea #1

My first idea for making money on the Web is to start a scam-busting site similar to Snopes.com (which investigates whether rumors or common conceptions are true or “urban legends”).  You could fund such a scam busting site using click ads and subscriptions from users.  Basic operations would have “investigators” sign up for online business opportunities and keep detailed reports of their financial progress.  Such a scam buster site has the side benefit of showing any business opportunities that do pan out and what actions caused the success.

Idea #2

Second idea: come up with a scam!  It may not be morally right, but right now in the absence of Idea #1, it’s surefire.  You will make money. Think of all the suckers like me! But if you’re human, you’ll have a problem taking advantage of others.

Idea #3

When I suggested at the beginning that a lot of people might think of selling something like virtual moon rocks, I was being facetious.  But not totally.  As long as you don’t misrepresent what you’re selling, it’s a legitimate business.  Remember the Pet Rock idea?  How about Cabbage Patch dolls and all the other toys that were merely sophisticated fads?  I doubt the market for matters of style and fashion has been exhausted.

But more important, I do feel that the creative class is on the rise, and it is thoroughly enabled by the Web.  So many ideas are out there that can gain traction, so many inventions… or simple product or service improvements.  My dear late brother was an inventor, and he would tell me when he was in his prime imagination era, he would just sit by himself alone and let his mind freewheel and consider what he might create or invent.  And with the Web, one’s creativity is magnified a hundredfold.

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Actually, I believe we are on the threshold of a surge of human creativity —leading to the Singularity—that will totally blow away the need for scams, not to mention for plunder politics.  But in the meantime, all my fellow humans, please be careful out there.

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[1] As many of you, I had always thought P.T. Barnum had uttered the famous words, “There’s a sucker born every minute.”  But it turns out, at least according to this history site that appears authentic, that a Syracuse banker named David Hannum, the owner of the original Cardiff Giant (which was a hoax but Hannum didn’t think it was a hoax) actually used the phrase to disparage P.T. Barnum for creating a second Cardiff Giant, which was a hoax.

[2] This is undoubtedly the same defect applying to the “plunder elites,” or what I have designated the Kleptocons.

[3] General rule for all commerce, if you’re going to use plastic for ordinary purchases, always make it a credit card—where you “borrow” the money from a bank to make a purchase and receive a monthly statement—(and of course always pay off your balance).  A debit card purchase is immediately taken out of your bank account; if there’s an error or fraud, you can recover, but it can take weeks or months before the value is returned to your account.

 

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