New York State Consumer Protection Board
For Immediate Release: May 20
Contact: Jon Sorensen (518) 473-9472
CPB exposes work-at-home business, "Home Stuffers, " to be nationwide pyramid scheme
Former agents reveal secrets of mail-order scam
America's largest home envelope-stuffing business, "Home Stuffers, " is actually a pyramid scheme that has defrauded tens of thousands of consumers across the country, according to the results of a two-month investigation by the New York State Consumer Protection Board ("CPB").
The CPB is issuing a nationwide consumer alert against Home Stuffers through the news media, the Better Business Bureau, usacomplaints.com and other consumer agencies. A Manhattan voicemail service that serves Home Stuffers has agreed to drop Home Stuffers as a result of the CPB's probe.
The CPB also has been aiding federal authorities in their investigation of Home Stuffers. Home Stuffers operates under many different names with more than 200 agents across the country. At a news conference today, a former Home Stuffers agent from the Capital District said Home Stuffers preys on people seeking a stay-at-home job.
"The only thing getting stuffed in Home Stuffers are the pockets of a few crooks, " said CPB Chairperson and Executive Director Teresa A. Santiago. "Home Stuffers lures people with the promise of a weekly salary of $1,380. All you have to do is stuff envelopes to 'market (the) products and services' of other companies."
But there are no other companies — only the Home Stuffers scam, Chairperson Santiago said. Envelopes are only stuffed with "training materials" that are used to recruit more people into Home Stuffers. Once a new recruit sends in a "refundable deposit" of $25 or more, the Home Stuffers agent keeps half of the money and sends the rest to a Home Stuffers hub in Alabama.
The CPB estimates that Home Stuffers has generated millions of dollars during the past two and a half years.
Like all pyramid schemes, the people at the bottom only make money if the pyramid continues to grow with the addition of new people. Most people walk away after they discover that there is no legitimate work available from Home Stuffers, " said Chairperson Santiago. Like most other work-at-home offers, Home Stuffers is a scam. Hand-stuffing envelopes is a thing of the past thanks to machines that can entirely process 5,000 mailers in a single hour."
The victims of Home Stuffers are generally low-income people or retirees looking to supplement their small incomes with a so-called work-at-home job. Most victims lose between $25 and $100, but some have spent hundreds of dollars before learning the truth about Home Stuffers. One woman in Kentucky claims she lost nearly $7,000 setting up a 'Home Stuffers' business in her home.
To find more recruits, Home Stuffers instructs its agents to take out newspaper advertisements and establish website and voice-mail systems. A 72-year-old woman retiree on Long Island told the CPB that she made $20,000 last year by running a Home Stuffers ad in national tabloids, such as the Globe.
"The company just wants to keep recruiting more and more people, " said the manager of a Home Stuffers businesses in the Bronx, one of the largest in the country. One of her Florida "customers, " eventually started his own independent Home Stuffers' venture (he did not split the funds with Home Stuffers higher command). This Florida man had his own Internet website and an e-mail system containing 50 million names.
A Long Island man also struck out on his own and it has produced a sizable income. Operating a website out of his home, the man now drives luxury cars and recently purchased a new house in New Jersey thanks to his profits from Home Stuffers.
At least two main offices in the Home Stuffers empire have been identified by the CPB: Akron, Alabama and Edmond, Oklahoma. Operating as the "Training and After Care Center" of Home Stuffers, these offices help Home Stuffers continue to operate, sending them the envelopes and instruction materials that are later mailed to new Home Stuffers applicants.
In addition to the initial $25 deposit, workers for Home Stuffers also pay between $1 and $5 directly to the Training and After Care Center for every training kit that is mailed to new recruits.
Internet and newspaper advertising is supplemented by a network of voicemail numbers. Messages on these voicemail numbers give new recruits a longer description of this enterprise, including the promise of weekly checks and bonuses.
"Today, the CPB is stuffing Home Stuffers, " Chairperson Santiago said. "We are encouraged by the results of our investigation and hope it leads to more Home Stuffers getting out of the business of scamming people."
New york state consumer protection board
Albany, New York
U.S.A.
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