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How many times have you asked that question? How many times have others asked you that question? Have you ever been scammed yourself? Do you know what do look for?
(1) Never work for a company w/o checking the company's background. Do you even know who the company is? Do you know who the parent company is (if the company is a subsidiary).
(2) Never, ever, ever, ever pay for a job, for an interview, for a "processing fee", or for a list of leads!!! It's ok to buy products to start the inventory for your sales business, it's ok to do a criminal background check, and it's ok to get a license or certification (provided it's for a state or national organization and not just for the company itself), but it's not ok to pay for a job.
(3) Check out the company's website. Is it professionally made? Is there contact information listed? The name of the company, the URL, and all associated information should match, and the site should not be created by a free web company (like lycos or geocities). Are there misspelled words? Are there crazy graphics? Are there misshapen or mis-sized photos? Are there phrases like "make $500 per week working part time!!!" or are there lots and lots of testimonials to try to convince you the company is legit? (FYI... those testimonials are paid advertising, and/or they're made by people who helped found the company in the beginning.) Are there any phrases like "No experience necessary! Anyone can do this!" Seriously, if "anyone" could do it, "everyone" would be doing it.
(4) Check out what other people are saying. You can do this by going to google, yahoo, etc. and putting the name of the company (in quotes) along with the word scam into the search box. If you get a lot of responses from your search that link you to websites or forums full of people bashing the company, you should steer clear!!
Thank you for the warning and advice on how to avoid scams. The list of websites to check for existing complaints is very good.
5) Check the scam websites! scams - report the scam here - The Better Business Bureau - The Federal Trade Commission - ScamBusters - RipOff Report
For a small company it is wise to run a background check on the owners of the company, before you give them a significant amount of your money or your labor. When you work at home, you are letting their business use your home, phone, computer, electricity, utilities, in other words they are costing you a lot more than the cash they ask you to pay for their "opportunity." Before I got hit with an expensive scam, I saw How to Do a Company Background Check. Company background checks are a little more complicated that doing a background check on an individual. Doing a background check on the individual owners is a subset of checking out their company. You can do both of them for free, but it takes a little work on your part.