Fake Prize, Sweepstakes, and Lottery Scams

(Last Updated On: August 21, 2022)

Fake Prize, Sweepstakes, and Lottery Scams

The promise of Big Winnings is Just a Fantasy!

How Scams Work – A SCARS Insight

A Lottery Scam Is No Win For Its Victims

You get a call, email, or letter saying you won a sweepstake, a lottery, or a prize — like an iPad, a new car, or something else. But you can tell it’s a scam because of what they do next: they ask you to pay money or give them your account information to get the prize. If you pay, you’ll lose your money and find out there is no prize.

3 Signs of a Prize Scam

Who doesn’t dream of winning a lot of money or a big prize? That’s why scammers still use the promise of a prize to get your money or personal information. The good news is that there are ways to tell you’re dealing with a scam.

Here are three signs of a prize scam:

  1. You have to pay to get your prize. But real prizes are free. So if someone tells you to pay a fee for “taxes,” “shipping and handling charges,” or “processing fees” to get your prize, you’re dealing with a scammer. And if they ask you to pay by wiring money, sending cash, or paying with gift cards or cryptocurrency to get your prize, don’t do it. Scammers use these payments because it’s hard to track who the money went to. And it’s almost impossible to get your money back.
  2. They say paying increases your odds of winning. But real sweepstakes are free and winning is by chance. It’s illegal for someone to ask you to pay to increase your odds of winning. Only a scammer will do that.
  3. You have to give your financial information. There’s absolutely no reason to ever give your bank account or credit card number to claim any prize or sweepstakes. If they ask for this information, don’t give it. It’s a scam.

How Scammers Try To Trick You

Scammers will say anything to get your money. Here are ways they try to trick you into thinking you really won a prize.

  • Scammers say they’re from the government when they’re not. Scammers try to look official. They want you to think you’ve won a government-supervised lottery or sweepstakes. They make up fake names like the “National Sweepstakes Bureau,” or pretend they’re from a real agency like the Federal Trade Commission. The truth is, the government won’t call you to demand money so you can collect a prize.
  • Scammers use names of organizations you might recognize. Scammers might pretend to be from well-known companies that run real sweepstakes. But no real sweepstakes company will contact you to ask for money so you can claim a prize. If you’re unsure, contact the real company directly to find out the truth. And look up the real company’s contact information yourself. Don’t rely on the person who reached out to you to provide you with the real contact information.
  • Scammers send you a message (via text, email, or social media) to get your personal information. You might be told that you won a gift card or a discount code to a local store. Or the message may say you won something expensive, like an iPad or a new car from your local dealership. Scammers hope you’ll respond with your personal information or click on links that can take your personal information or download malware onto your device. Don’t respond.
  • Scammers make it seem like you’re the only person who won a prize. But the same text, email, or letter went to lots of people. If your message came by mail, check the postmark on the envelope or postcard. If your “notice” was mailed by bulk rate, it means many other people got the same notice, too. For other types of messages, check online to see if others are reporting that they got the same message.
  • Scammers say you’ve won a foreign lottery, or that you can buy tickets for one. Messages about a foreign lottery are almost certainly from a scammer — and it’s a bad idea to respond. First, it’s illegal for U.S. citizens to play a foreign lottery, so don’t trust someone who asks you to break the law. Second, if you buy a foreign lottery ticket, expect many more offers for fake lotteries or scammy investment “opportunities.” Finally, there are no secret systems for winning foreign lotteries, so don’t believe someone who tells you they can help you win.
  • Scammers pressure you to act now to get a prize. Scammers want you to hurry up and pay or give them information. They tell you it’s a limited time offer or you have to “act now” to claim your prize. They don’t want you to have time to evaluate what’s really happening. Don’t be rushed — especially if they want you to do something to get your prize.
  • Scammers send you a check and ask you to send some of the money back. This is a fake check scam. If you deposit the check, it can take the bank weeks to figure out that it’s fake. In the meantime, the bank has to make the funds available, so it can look like the money is in your account. But once the bank finds out the check is fake, they’ll want you to pay back the funds.

If you’re not sure about a contest or the company sending you a prize notification, search online to see if you find anything about them. Type the name with terms like “review,” “complaint,” or “scam.”

What To Know About Real Contests and Prizes

Plenty of contests are run by reputable marketers and non-profit organizations. But there are some things to know before you drop in a quick entry or follow instructions to claim a prize.

  • Real sweepstakes are free and by chance. It’s illegal to ask you to pay or buy something to enter or to increase your odds of winning.
  • Contest promoters might sell your information to advertisers. If you sign up for a contest or a drawing, you’re likely to get more promotional mail, telemarketing calls, or spam.
  • Contest promoters have to tell you certain things. If they call you, the law says they have to tell you that entering is free, what the prizes are and their value, the odds of winning, and how you’d redeem a prize.
  • Sweepstakes mailings must say you don’t have to pay to participate. They also can’t claim you’re a winner unless you’ve actually won a prize. And if they include a fake check in their mailing, it has to clearly say that it’s non-negotiable and has no cash value.

A special note about skills contests. A skills contest — where you do things like solve problems or answer questions correctly to earn prizes  can ask you to pay to play. But you might end up paying repeatedly, with each round getting more difficult and expensive before you realize it’s impossible to win or just a scam. Skills contests can leave contestants with nothing to show for their money and effort.

What To Do if You Paid a Scammer

Scammers often ask you to pay in ways that make it tough to get your money back. No matter how you paid a scammer, the sooner you act, the better. Learn more about how to get your money back.

Report Prize Winnings and Lottery Scams

If you think you’ve been targeted by a prize scam:

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