Google Sues to Stop Work-From-Home Scams
Google Warns of Scam Sites That Use Its Logo and Fake News Pages
By ALICE GOMSTYN
ABC NEWS Business Unit
Dec. 8, 2009 —
Google has launched a legal battle against companies that allegedly infringe upon the Google name to promote "work-from-home" scams.
"At the heart of the scheme is a false representation that consumers can participate in a Google-sponsored program that will allow them to make hundreds of dollars a day working at home performing a simple task that requires no particular experience or qualifications," the search engine giant wrote in a 26-page claim filed in U.S. District Court in Utah.
The lawsuit names Nevada-based Pacific WebWorks and 50 other defendants referred to only as "Does 1 through 50."
Pacific WebWorks did not immediately return calls for comment from ABCNews.com. According to the Google claim, Pacific WebWorks operates a credit card processing site.
The defendants, Google said in its lawsuit, "deceive the public by misusing the famous Google brand and GOOGLE marks to sell to consumers work-at-home kits purporting to train and enable consumers to earn money using Google services."
The unnamed defendants use fake news articles, fake news blogs and fake testimonials to promote their services and direct them to credit card processing sites like the one run by Pacific WebWorks, Google said.
The schemes are advertised as free, Google said, but then often charge various fees, including monthly charges between $50 and $79.90. Customers wind up paying these charges through their credit or debit cards, which they provide online when they sign up for the alleged schemes.
In return for their payments, Google said, customers often receive nothing at all, DVDs containing viruses or links to information that is already available free on the Internet, including Google's own free online help center.
Google is warning customers to be wary of the following work-from-home promotions: Google Adwork, Google ATM, Google Biz Kit, Google Cash, Earn Google Cash Kit, Google Fortune, Google Marketing Kit, Google Profits, The Home Business Kit for Google, Google StartUp Kit, and Google Works
Google's lawsuit comes one month after a class action complaint was filed against Pacific WebWorks and an unnamed defendant for a work-at-home scheme.
"Misleading ads try to take advantage of consumers in the midst of a difficult economy, and as the economic situation has worsened, the problem has only grown," Google said in a statement posted to the search engine's official blog. "As far as we can tell, thousands of people have been tricked into sending payment information and being charged hidden fees by questionable operations."
Looking for a Safety Net
It was the difficult economy that propelled Ohio corrections officer Christine Kufel to sign up with a work-at-home program advertised as being connected to Google.
Like many Americans, Kufel worried about her job security, so she thought she'd create her own safety net by earning extra income at home. A Web site advertisement promising work-from-home opportunities seemed like a good fit, she said. The site said customers could earn $300 to $1,000 a day by starting their own businesses.
Questionable Connections
But the affiliations suggested by the site were questionable at best: It said that customers would earn cash "working from home with Google," even though Google says it does not endorse such work-from-home sites.
It also claimed that it had been featured by television news organizations, including ABC News and CNN.
Both organizations say they haven't endorsed the site. The site's only real connection to legitimate news organizations, experts say, seems to be through paid advertisements placed on those organizations' Web sites.
But Kufel, who told ABCNews.com her story this past summer, didn't know about these dubious connections when she signed up.
The references to the popular search engine and television news, she said, gave her a sense there was "some legitimacy" to what it offered. She thought the site would help her do some sort of sales or marketing work from home with the help of a special business kit.
"You see big names like that and you think, 'OK, well it's valid … it's worth looking into at that point,' " she said.
Now Kufel wishes she hadn't. The company, she said, tried to charge $84 to her credit card without ever sending her the kit. Kufel said she called her credit card company and managed to cancel the charge before it went through, but she's still angry.
"I was scammed," she said.
Hundreds of Consumers Complain
The Better Business Bureau said it has received hundreds of complaints from consumers who say they've been scammed by Web sites advertising work-from-home opportunities that appear to be affiliated with Google.
Earlier this year, the Federal Trade Commission (FTC) took one such site, Google Money Tree, to court, alleging that the companies behind the site misrepresented their affiliations with Google and didn't adequately explain to customers that they'd be charged $72.21 a month for signing up with the site.
In an answer to the FTC's complaint, defendants in the case argued that their "conduct was at all times was reasonable, proper, and in good faith, and Defendants did not directly or indirectly undertake any action in violation of the law."
Though court records show that a preliminary monetary settlement was reached between the FTC and the Money Tree defendants in November, an FTC official said the litigation was ongoing and declined to offer further comment. Lawyers for the defense did not immediately respond to calls from ABCNews.com.
Reputable Brands, Troubling Ads
Alison Southwick, a spokeswoman for the Better Business Bureau, said work-from-home scammers use both Google and TV logos to gain credibility for their dubious operations -- and sometimes it works.
Consumers think, "Oh, this was featured in a news story, so it must be legitimate, but usually buried in the bottom in very fine print, it says, 'We are not affiliated with ABC, CNN, etc.,'" she said.
What can further confuse consumers, she said, is that advertisements for the scams sometimes show up on legitimate news Web sites, including this one.
Here's how it works: A news Web site contracts with advertising placement companies to provide small text ads and links -- the kind you'll often see at the very bottom of online news articles. It's the ad placement company, not the news site, that controls the ads.
Some of the ads are placed based on context. For instance, an ad for a tooth-whitening company may appear below a news article about a dentist. Likewise, an ad for working-from-home operations may appear near a news article about careers.
Google has an ad placement service, and the Web giant concedes that it just can't stop all scam ads, including scam work-from-home sites, from being delivered to its clients.
"We have hundreds of thousands of advertisers," said Google's Morrison told ABCNews.com in August. "We can't look at every ad, so we have to rely on automated methods."
He added, "It's an arms race. Every time we clamp down, they find a work around."
AOL Defends Ad Quality
One of the largest online ad placement companies is Quigo, which is owned by AOL. The company places ads with ABC News, Fox News and USA Today, among others.
"AOL makes efforts to maintain high quality advertising standards," AOL said in an August written statement. "However, advertisers are ultimately responsible for complying with obligations concerning their consumers."
Legitimate Web sites continue to contract with ad placement firms despite the risk of scam ads because the revenue brought in by the ads is large compared to the minuscule financial cost of hosting the ads, said Eric Clemons, a professor at the Wharton School of Business at the University of Pennsylvania. The same isn't true, he said, for ads running on television and in newspapers, where commercial time and ad space, respectively, are more expensive.
"Basically, every little bit helps, and firms are not thinking about the reputational impact of accepting ads on a Web site that they would never accept either for print or broadcast," Clemons said.
Real News, Scam Ads: Making the Distinction
Career expert Tory Johnson, the CEO of Women For Hire and a workplace contributor to "Good Morning America," says it is important for consumers to recognize the difference between news articles and ads placed on news sites.
Johnson has found links to apparent work-from-home scams on pages containing her own ABCNews.com articles.
"That's a key distinction," she said. "Consumers, Web site visitors should look for the fine print that says 'sponsored ads,' 'advertisement' or 'sponsored link.'"
The ads to suspicious work-from-home sites don't necessarily lead directly to the sites themselves. Often, the links lead to what appear to be newspaper sites. Such sites, the Better Business Bureau's Southwick said, are typically fake.
It's those phony newspaper sites that then link to work-from-home sites, including those that mislead consumers by using logos for Google and news organizations.
Kufel said that's how she wound up on the work-from-home site that ultimately scammed her -- she saw an advertisement for it on a news site, followed the ad link to what appeared to be a newspaper site and followed links from there to the work-from-home site.
After removing the company's charge from her credit card, Kufel was still worried that the company might try to charge her again, so she cancelled her card and asked that a credit reporting agency put a fraud alert on her credit report.
She also reached out to Meiselman, Denlea, Packman, Carton & Eberz, a New York law firm considering a class action lawsuit against companies perpetuating apparent work-from-home scams using the Google name.
Lawyer Jerome Noll said the companies have been hard to track down. He was not surprised to learn that Google's lawsuit targeted dozens of unnamed defendants in addition to Pacific WebWorks.
"If you try to hunt them down, they've got P.O. boxes, their phone numbers are disconnected," he said. "Unfortunately, there really isn't a defendant worth suing. ... They're fly-by-night operations that just are there to scam as many consumers as possible out of their money and then disappear."
The Whack-a-Mole Dilemma
Even finding and stopping one company may not do much about the larger problem. Experts say that trying to shut down such Web sites is like playing a game of "whack-a-mole" -- as soon as you hit one, another pops up.
A consumer's best bet, Women For Hire's Johnson said, is to watch out for themselves.
"I think especially given the economy, with more pressure than ever to find a way to generate income, more and more people are suspending the average common sense," she said.
"This is the time you have to be even more critical -- you have to be more vigilant than ever before," she said.
Google has compiled a list of tips on "how to steer clear of money scams." Find them here.
ABC News' Becky Worley and Carolyn Weddell contributed to this report.