Recommendations | Fraudulent schemes for freelancing the contractor and the customer: how to avoid the trap

There are more than 70 million freelancers in Russia, and this type of employment is becoming increasingly popular.

In 2020, the number of freelancers in Russia was 14 million, and in 2021 it has already reached 71 million. Every tenth resident of the country (11%) considers himself a freelancer or, from the point of view of current legislation, self-employed.

In public opinion, a freelancer is someone who finds a job on his own, a free and self — employed employee (15%). Freelancers also include those who work for themselves (5%) and those who work remotely (5%).

According to the freelance exchange KWork, in 2020 the number of customers on the platform increased by 93%, and performers-by 128%.

The most common age groups among freelancers are from 18 to 34 years (68%) and from 35 to 44 years (18%), according to PwC analysts. The National Guild of Freelancers reports that 60% of these employees are men. 43% of freelancers have higher education, 26% are registered as self-employed or sole proprietors, and 29% plan to apply for these statuses.

Survey conducted hh.ru among freelancers, the survey showed that respondents primarily value the ability to independently plan their working hours (79%), save time and money on the road (75%), work without reference to a specific city or country (64%), and the ability to combine several jobs (47%)..

According to research conducted by the TalentTech IT Holding, the Higher School of Economics, and the freelancing exchange FL.ru the main clients of freelancers are individuals and sole proprietors (45%). In second place are small companies with up to 50 employees (39%), while the share of medium and large companies is 16%. Only 26% of customers attract freelancers on a permanent basis, while 74% do it sporadically.

But along with the growing popularity of remote work, the risk of encountering unscrupulous customers or performers also increases. Scammers seek to exploit remote interaction vulnerabilities to deceive both freelancers and those customers who are looking for remote workers. How to detect and avoid typical freelance fraud schemes?

Typical fraud schemes

Typical fraud schemes for freelance performers:

1. Offer unreasonably favorable working conditions with promises of “golden mountains” in the future at low pay at the moment. The goal is to find free labor.
2. Receiving the finished work from the contractor and disappearing without payment. The solution is to demand an advance, a contract, or a “Safe Deal”.
3. Persuasion to perform rough work before entering into a contract. The goal is to get free ideas/sketches.
4. Collecting works under the pretext of tests or contests without a guarantee of payment. The customer, wanting to make sure of the quality of the work, demands to complete the test task without paying for it. In this situation, there is a risk that the “test task” will turn out to be a full-fledged job that the customer will receive for free.
5. Attempts to introduce malware under the guise of a technical task or completed work. The solution is to check files and links carefully.
6. Dummy files are sent that cannot be opened and require payment.

Key recommendations for freelancers:

1. Carefully study the terms of each offer and don’t rush to agree.
2. Use contracts, prepayments, or “Secure Transactions” to minimize risks.
3. Do not perform work for free until you are officially selected as a performer.
4. Check the customer’s reputation and be vigilant when receiving files.
5. Use security tools (antivirus programs, two-factor authentication).

Analysis of the types of customers who don’t pay

“Cool” businessmen. There is a category of customers who present themselves as “cool” businessmen, “doing business”. They promise payment “from the first profit”, offer a percentage of the profit and assure that you are participating in a” breakthrough “ project. Such customers are often “ fed “ with promises, but there will be no money or success from the project. The more promises you make, the less likely you are to get paid.

The donkey put on a lion’s skin, and everyone thought it was a lion. The people and cattle ran. The wind began to blow, and the donkey’s hide opened.

Recommendation: Do not agree to these terms without paying in advance. Work “here and now”, do not rely on future promises.

Exception: If you are offered a share in the company, it must be legally executed (contract, compliance with all formalities).

“Unfortunate” defrauded depositors.

Such customers “put pressure on pity”, saying that “everything is not going according to plan”: the supplier “threw”, the bank account was “blocked”, the mother “got sick”, the car “broke down”. They promise to pay “in three days”, but then they disappear and do not respond to messages.

As long as there are fools in the world , we can live by deception, therefore, with our hands.

What a blue sky, We are not supporters of robbery: You don’t need a knife for a fool ,You can lie to him with three boxes — And do with him what you want!

Recommendation: If the customer delays paying for more than a week, you should threaten them with a court order or add them to the blacklist.

“Dissatisfied” critics.

“Be quiet! I’m tired of listening, Free me to sort out your guilt, puppy! It’s your fault that I want to eat.”

Such customers are looking for a reason not to pay. They will “criticize” the work to the nines, but they do not want to make amendments.

Recommendation: If the customer is dissatisfied but honest, they will constructively discuss the shortcomings of the work and ask for corrections. A dishonest customer will simply “throw off” the work.

The most significant disadvantage of working with freelancers, according to customers, is the instability and unpredictability of the quality of work performed (51% of respondents). 39% noted the need for constant search for performers, 36% indicated problems in communication and incorrect understanding of the tasks set, 35% and 34% — irresponsibility, non-necessity of freelancers and high risks of deception.

Key recommendations for customers:

1. First, it is worth remembering that the principle of “miser pays twice” is especially relevant in the field of remote work. Offers of “cheaper than most” or “very cheap” often come from non-professional performers trying to stand out through dumping, or from scammers.
2. Carefully study the artist’s page. Professionals who are confident in their skills usually talk in detail about themselves, have an extensive portfolio and positive reviews. An empty account or scant information should alert you.
3. Check the contractor’s contact details in different sources. Scammers often use similar but slightly different logins, numbers, and emails. It is also useful to search for known problematic contacts.
4. Pay attention to the content of the conversation with the potential performer. A professional will ask clarifying questions about the terms of reference, while a fraudster is usually more interested in paying.
5. It is recommended to use partial payment methods, “Secure transaction” and other tools, so as not to give away all the money at once. Fraudsters often reject such methods, offering “faster “and” more convenient “ payment options.

In general, by following these principles, you will be able to minimize risks when interacting with performers via the Internet. If you have any suspicions , it is better to choose another, more reliable option.

A search on the Internet can help you find out a lot about the customer, for example, that their Skype or social network was mentioned in other freelancers ‘complaints about”scammers”. Knowing common deception patterns and following key recommendations is a reliable way to protect yourself in this highly competitive remote employment environment.

Prudence, care and application of engineering approaches to the analysis of conditions allow freelancers to successfully avoid falling into the trap of scammers.

Have you ever encountered fraud on a freelance basis?

What methods do you use to protect yourself from scammers?

What do you think can be done to reduce the amount of fraud on freelancing?

Methods of countering and returning funds if there is information about the fraudster

Psychological mechanisms used by fraudsters to manipulate victims

• Create a sense of urgency: Scammers often create a sense of urgency by forcing victims to make decisions under duress and without due consideration.
• Playing on emotions: Scammers can play on the emotions of victims, such as fear, greed, or hope, to force them to act against their own interests. Use manipulative tactics to create feelings of guilt, fear, or anxiety. For example, they reported a “difficult financial situation” in order to force the victim to give up money or agree to dangerous conditions.
• Authority: Scammers can pose as authority figures, such as bank or law enforcement officials, to gain the trust of their victims.
• Confirmation of social proof: Scammers can use fake social proof, such as positive reviews or false testimonials, to convince victims of their trustworthiness. “I came across this site, where all the reviews are excellent. And attached are screenshots of completed work.”

• Deceptive promises: Scammers most often use promises of immediate benefits or unexpected winnings, creating false hopes of getting rich quickly.

If you have information about fraudulent activities, it is important to take measures to protect your interests and recover lost funds. In this context, several key methods can be identified:

1. Report fraud on the platform where the crime occurred. Every self-respecting freelance platform or job showcase has its own anti-fraud procedures. Provide all collected information, including correspondence, documents, and other evidence. This will help platform administrators take appropriate action.
2. If you know the scammer’s social media platforms or place of work, send them a message about the situation to their friends.
3. Contact law enforcement agencies. Collect all possible evidence (screenshots, correspondence, contracts) and file a fraud report. The more information you provide, the more likely it is that your case will be actively investigated.
4. File a complaint with the Consumer Protection Services. If fraud occurred as a result of violations of the terms of service, such organizations can help you take action against the violators.
5. Seek legal assistance. Consulting with a lawyer who specializes in fraud and trading cases can provide valuable information about your rights and options for getting money back through the courts.
6. Provide information to specialized resources on combating Internet fraud. There are online platforms such as ScamPulse.com , otzovik.com where you can file a complaint about a fraudster and share information about their activities. This helps warn other potential victims.
7. Take advantage of insurance policies. If you make large transactions, consider using services that protect your financial activity. Some platforms may offer insurance for your payments.
8. Stay tuned for your complaints and questions. After submitting an application, it is important to stay in touch with the authorities and platforms to keep up with the progress of the case.

How I got my money back from a fraudster using information about their social networks:

1. Attempt at a peaceful solution: I tried to explain to the fraudster “in a good way” that his actions were wrong and that he should return the money. Unfortunately, this didn’t work.

2. Contacting the platform support service: I contacted the support service of the freelance platform, providing them with evidence of fraud (correspondence). I asked you to block the scammer’s profile.

3. “Pressure” through a professional network: I used information about the fraudster (his nickname in social networks) and found his profile on LinkedIn and VK. I found out where he works and wrote a message to all employees (including the director) about his fraudulent activities, attaching evidence.

4. Result: The fraudster, feeling “pressure”, contacted me a week later and expressed his readiness to return the money.

Sometimes putting pressure on a fraudster through their social media accounts can be an effective way to get money back. However, it is important to proceed cautiously and not violate the law.

Additional comments:

I only used the scammer’s LinkedIn information for refund purposes. Fraudsters ‘ refund methods may differ depending on the specific situation. In some cases, it is better to contact law enforcement agencies and not take independent actions.

Recommendations | Fraudulent schemes for freelancing the contractor and the customer: how to avoid the trap