Job Scams Are Rising — Here's How You Can Protect Yourself From Employment Fraud

On the hunt for a new job? You may need add fraud protection to your search and application process.

From 2019 to 2023, reported cases of “business and job opportunity” fraud nearly tripled from about 38,000 to 107,000, according to the Federal Trade Commission (FTC). Those numbers might sound small given how many people apply for work in a given year, but last year it added up to a total of $490.7 million lost — the third highest loss of all fraud categories.

Experts say the shift to remote work, plus wider access to newer technology like crypto and AI, created new opportunities for fraudsters. More recently, large-scale corporate layoffs make the promise of a high-paying job hard for some applicants to resist, according to Brittany Allen, a trust and safety architect at Sift, a fraud prevention company.

“Employment scams generally increase in prevalence when there are layoffs or a high unemployment rate. People are more desperate for a job to the point where they're willing to look past quite a few red flags,” Allen says. “There are so many layoffs that make the news each week, so I'm not surprised that it would be increasing.”

Job scams can appear in several forms. One of the most common types is phony job offers from individuals who are trying to steal your data, potentially to take out lines of credit in your name. Another prevalent type involves scammers asking for upfront payment for job training or equipment that isn’t real.

Here’s what you need to know about employment fraud and how to avoid it at every step of the job search, from the application to the background check:

Types of job scams in 2024

The way that scammers are taking advantage of people with employment schemes has changed in recent years. In 2021, victims of this type of fraud were most commonly contacted via text messaging. When payment was involved, the top method was wire transfer.

For the last two years now, email scams have been most popular and crypto is the new main payment method.

The perpetrators of employment scams will often create fake job listings online to collect personally identifiable information like Social Security numbers and bank account info. Reputable job boards try to filter out fake job listings, but some things slip through the cracks.

“Fraudsters are then able to take that information and resell it, or use it to open lines of credit in those victims’ names,” Allen says.

A second category of employment scams seeks payment from job seekers in exchange for promised services.

An example of this type of scam involves background checks. A scammer might contact you about a fake job opportunity and ask you to pay a few hundred dollars for a background check (that's also fake). From there, these scams can spiral when the victim is asked for additional payment to remove negative items that were purportedly found in the background check.

“The scammer might say we found something really strange or upsetting on your background check, but don't worry, we partner with an agency — pay us $300 more dollars and we'll fix it,” Allen says.

Some victims of these scams can end up paying thousands of dollars to the wrong people. According to FTC data, the median loss reported in a business and job scam was about $2,100 last year.

How to spot job scams

There are several classic signs of a job scam, even as they evolve in sophistication. Understanding how to spot them will help you protect against identity theft and other fraud.

First of all, be skeptical of any job opportunity you encounter online that feels suspiciously easy or lucrative. This includes jobs that claim they’ll pay you upfront before any work has been performed, as well as listings that promise high pay with minimal hiring requirements.

Make sure to research the hiring company and read online reviews. You should include keywords like “scam” in your searches to see if there are complaints about the company supposedly hiring.

Fake job listings are often designed to harvest your personal information, so it’s a bad sign if you’re pushed to share a lot of that info before you’ve even spoken with a representative of the company.

“Candidates may be asked by scammers to provide their Social Security number under the impression of setting up direct deposit, putting their identity and bank accounts in jeopardy,” Zulfikar Ramzan, chief scientist and executive vice president of product and development at digital security company Aura, said in an email.

Remember that it’s rare for candidates to have to pay to apply for a job or pre-hire training. If anyone asks you to send payment as part of an application, stop what you're doing immediately.

You should also beware of suspicious messages on job sites, social media and messaging apps from recruiters who may be posing as representatives of major companies. Allen notes that recruiters at publicly-traded companies typically have thousands of LinkedIn connections, so if you get a message from someone with only a handful of followers, it’s probably fake. Block or report the account.

Also, legitimate recruiters generally contact candidates from their work accounts, which means the company's domain name is in the email address. If you get a message from a recruiter that looks like it’s from a personal email address, it may be fake.

What to do if you fall for a job scam

The first thing to do if you’re a victim of a job scam? Check your credit report. If your identity has been stolen, someone may be opening lines of credit in your name.

This activity will soon show up on your file, and you can monitor that by pulling free weekly copies of your credit reports from the three major credit reporting agencies. You will need to dispute any false items that show up. Another option is to consider freezing your credit, which will stop criminals from accessing your credit file and opening accounts.

“If you’re the victim of employment identity theft, you need to act immediately to prevent further damage,” Ramzan said.

Beyond the steps mentioned, you should monitor your bank accounts and report any suspicious activity, experts say. Victims of these scams should also file reports to the Federal Trade Commission and, in some cases, local law enforcement.

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