The ubiquity of remote work and online hiring has led to a sharp rise in job scams across industries. In these swindles—sometimes called employment scams or recruitment scams—fraudsters impersonate job recruiters from real companies and convince job seekers, who have often posted their résumés on job recruiting websites or social media platforms, that they are taking part in legitimate recruitment processes or have landed jobs, which are in fact phony and nonexistent. Usually communicating through email or text message, the fake recruiters induce victims to hand over personal information, cash bogus checks, or send money for training or office equipment.
These are profitable crimes. The financial losses of job scams swelled when the COVID-19 pandemic hit, from $174.2 million in 2020 to $209.1 million in 2021, to $367.4 million in 2022, according to the Federal Trade Commission (FTC), a 110% increase in just two years.
Job scams may grow more common with the rapid adoption of chatbots that can mimic human-conversation. These programs may make it easier for malicious actors whose first language is not English to converse convincingly with English-speaking victims. (For a discussion of this and other legal and business risks of chatbots and generative artificial intelligence, see WilmerHale's recent client alert.)
In addition to the victimized jobseekers, these frauds harm the impersonated companies, by tarnishing their brands and harming their reputations in the contest for talent, all while creating significant distractions and unplanned costs. Every case is different, and a business should work with counsel to respond to the circumstances of each situation. But in general, companies should consider the following key steps when responding to a job scam incident.
- Act Quickly. Malicious actors are
likely to keep at a fraud so long as it is successful, and to
desist and move on to the next victim if the company or law
enforcement take steps to impede the swindle.
- Speak Out. To warn potential victims
of the fraudulent activity, companies should consider posting a
public statement advising jobseekers of the fraud to their
websites, social media accounts, and profiles on recruiter
websites, such as LinkedIn, Indeed, and ZipRecruiter, once they
learn of it.
- Report Impersonation Accounts.
Fraudsters often set up webpages and email accounts that
impersonate a legitimate company's website to give the scam a
believable gloss. For example, a fraudster targeting
XYZConsulting.com may create the website XYZConsultingJobs.org, to
which it can lure victims for their "job interviews."
Impersonation campaigns often infringe on a company's
intellectual property and violate the domain hosts' terms of
service. Businesses, either on their own or working with counsel,
can usually have these impersonation sites taken down by filing
reports with the web or email domain hosting companies. Likewise,
companies should report phony job posts to job recruitment websites
or social media platforms.
- Keep Records. Companies should hold
on to documentation both of the scams and the financial harm caused
by the scammers to jobseekers and the company.
- Contact Law Enforcement. The FBI is
responsible for investigating job scams, and companies, either
directly or through counsel, should consider reporting job scams to
the FBI's Internet Crime Complaint Center
("IC3") and directly to the relevant FBI field office.
Law enforcement may ask for the documentation both of the scams and
of the financial harm caused by the scammers to jobseekers and the
company.
- Send Cease-and-Desist Letters. Companies may choose through counsel to send a cease-and-desist letter to the malicious actors directly.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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