Employment fraud is an attempt to defraud people who are seeking employment by giving them false hope of better employment, often with more favorable hours, better job duties, or higher wages.They often advertise at the same locations as genuine employers and may ask for money in exchange for an opportunity to apply for a job.
Signs of fraud
A fraudulent offer may include a company name or logo along with requests for personal information, such as a passport and bank details. They also often ask for money for processing fees.
Types of fraud
Recruitment agent fraud
Recruiters of an agency or independent recruiters commit fraud when they increase their profit margin through misrepresentation and convinces candidate contractors or consultants that their skills are not good enough for the hourly rate that they are asking. At the same time, to increase the other end of their profit margin, recruiter through misrepresentation, convinces candidates that there is no candidate available on the market for the hourly rate the recruiter is offering. This way recruiters through misrepresentation of both candidate and employer make damage to both but gain for themselves. It would not count as a fraud if a recruiter would not use misrepresentation. Because there is a misrepresentation involved, it is considered a fraud. This type of fraud is widespread in countries like the United Kingdom, where law enforcement agencies are negligent and jury trials are not mandatory or do not exist at all, and due to corruption, it is impossible to enforce the law through private prosecution or civil remedies.
Recruitment fraud
This type of fraud involves a person misrepresenting themselves as an employee of a particular company and acting on its behalf to offer a fictitious job opportunity. This type of fraud is generally conducted through the internet.
Advertising fraud
Any advertising or promotion that misrepresents the nature, characteristics, qualities or geographic origin of goods, services or commercial activities that lures the victim into a situation where out of desperation or lack of knowledge, they are tricked into committing a crime or become a victim of a crime such as identity theft, embezzlement or similar types of frauds.
Employers conspiracy fraud
This type of fraud happens when several employers conspire against a specific candidate to force them to work for a specific employer and/or to cause financial damage to this person, so they would agree to work for lesser wage than their market value or conspiring employer job ad stated salary via avoiding hiring them under different false reasons and through misrepresentation. For instance, the conspiring employers after the whole hiring process is accomplished may say they need more time to decide and never give any decision or after the whole hiring process is completed conspiring employer would state the false reason for not hiring victim candidates. It is similar to price fixing. This type of fraud is very difficult to prove.
Types of employment scams
Mystery shopper
The victim applies to be a mystery shopper. They are asked to test a money wiring service such as Western Union, and to report back on the experience. The victim receives a check and is told to withdraw the value of the check-in cash. This leads them to believe the check has cleared, although the check is fake. It can take weeks to uncover the fraud. They then send the money via the wire transfer service either back to the sender or to some sort of money laundering scheme.
Payment administration
The victim is asked to handle payments on behalf of an overseas company, earning a fee for every payment handling. The companies turn out to be a front for illegal activity, implicating the victim in the crime.
Guaranteed employment/income scams
The victim is guaranteed a certain income or employment. To get this they first have to buy something like a business plan, start-up materials, or software. They may be asked to pay to be put on a directory to "guarantee" jobs. This is merely a way to get the victim to spend money – no job awaits.
Multi-level marketing
People selling through a multi-level marketing scheme earn a commission on the sales of those they recruit, as well as on their direct sales. Some multi-level marketing schemes, like Tupperware, can be legitimate businesses. However, some multi-level marketing schemes are pyramid schemes in disguise. The products may be of poor quality, overpriced, and hard to sell, or the victim may be asked to spend heavily on useless training materials. Some multi-level marketing schemes may require money from the victim to join.
Visa/work permits
A prospective employer overseas says that it will handle the victim's work visa application, but instructs the victim to send money in the guise of processing fees. The scammer takes the money and vanishes.
International Trade
Crime and fraud are an increasing threat to businesses that operate within the international trade sector. Fraud is defined as deceit for financial profit, and costs the UK an estimated £110 billion annually. The main threat to international traders is from organised crime, including the theft of goods or business identity, cross-border crime and road-freight crime. Other risks include infringement of intellectual property or employee fraud. Online trading developed a new platform for criminal activity, such as new ways of laundering money. Businesses that do international trade under the EU can rely on shared laws and commercial procedures to protect them.
