There are a lot of slimy bastards out there. A lot. Seriously. And every one of them is just dying to screw you out of a dollar, or ten, or a thousand. Point is: people want your money.
The problem is that slimy bastards don't come out and introduce themselves as slimy bastards. Usually, they come off as kind, interested, caring, and on your team. They make offers and promises, all under the guise of helping you out, but as soon as they get their grubby fingers into your wallet, everything changes.
It's tough to be a indie author, (it's also tough to be traditionally published, but that's a different set of problems) you have to carry your intellectual properties on your own. Writing. (duh) Editing. Formatting. Cover art. Finding reviewers. Finding readers. Social networking. Selling yourself and your work at every opportunity.
It doesn't take long to learn that you probably need some help. Unfortunately, when many of us get to the point where we realize we need a hand, it's at a point of desperation. Ink, sweat, and tears have gotten you this far... how can you give any more?
So you do a quick Google search:
"buy cover art"
"cheap book editing"
"how to self publish"
And that's when the bastards show up.
"Free ebook help!"
"Let us do the work for you!"
"Ocean Front Property, Cheap"
There are a lot of folks out there who claim they have just what you need. Sometimes, it seems too good to be true. Most times, it really is. I don't know all the tricks, and I don't have all the answers. But I do have some guidelines that might steer you away from the slimy bastards. Use these, and look for other tips out there that might keep you from getting ripped off. It's easy to get excited about publishing something you've written, but jumping the gun could cost you more than you know.
1: Publishers don't ask you for money. Ever. No processing fees, no shelving costs, nothing. If a publisher is interested in your work, you will go through some negotiations (hopefully with your agent as a buffer between you and the publisher) about an advance, (money that they will give you as an investment, based on what they believe they will earn from your book) about royalties, (the money you will make per book sold, after book sales have paid the publisher back for your advance) and about the rights to your work (who can sell, distribute, publish, and convert the foreign/audio/movie rights to your book).
Publishers who ask authors for money up front are known as "vanity" publishers, and a huge majority of these companies are garbage. They are not there to help you get the word out about your book, they are there to take your money, and run.
(This rule stands for literary agents as well. They should never ask you for money.)
2: The act of self publishing a book has no up-front costs. Amazon.com does not charge you to publish a book with them. Neither do Barnes and Noble, Smashwords, Kobo, or Apple. They are happy to let you publish your book with them, because they are going to take a small percentage from each book you sell. For example, when you publish with Kindle Direct Publishing, you will receive either 35% or 70% of the list price, depending on how you price your work. Amazon gets to keep the rest.
3: Cover art, formatting, and editing can cost a lot, or a little, or even be free; but it's very important you know who you're dealing with. When you find a cover artist, (or anyone else you are going to pay to benefit your work, including editors, book formatting services, etc...) search for work they've already done, try and contact authors or publishers they've worked with. It's important to know who you're giving your money to. If you do a little bit of homework (aka Googling) you should be able to find testimonials or reviews from real people. If there's a lot of accusations, or poor word of mouth out there, you might want to stay away.