Imagine getting a letter, email or phone call alerting you to the prize you just won. Several people would get extremely excited and never even question the validity of the prize. Just the thought of winning is enough to be thrilled enough not to wonder. Scammers take advantage of people, thus getting them involved in the ever-growing trend known as a sweepstake scam.
What Is a Sweepstake Scam?
Sweepstake scams are typically scams related to the lottery or sweepstakes and generally involves some form of a monetary transaction, defrauding victims out of small to large sums of money. Scammers contact individuals to alert them of their “winnings” but there is always a next step that includes the sweepstake scam “winner” being asked to send money.
- Pay taxes on winnings
- Pay a fee to receive the winnings
- Provide a customs fee to send the money
- Give the caller their bank account information to make the deposit
- Request you to send them funds on a gift or Visa card or via wire transfer
Once the funds are sent, the sender usually loses all their funds and depending on the situation, they may be unable to recoup the full amount or any at all.
How Do Scammers Contact Sweepstake Scam Victims?
Scammers for sweepstake scams have become more creative in the way they contact the individuals they target to scam.
- Social media, especially Facebook and Facebook Messenger
- Website pop-ups
- Fraudulent emails
- Phone calls representing themselves as a sweepstake or lottery company
- Text message
10 Ways to Spot a Sweepstake Scam
Con artists can make a scam look and sound like the best thing to ever happen to you. Therefore, it’s important to pay close attention to the warning signs to prevent yourself or those you know from becoming another scammer’s victim.
1. Pay to Receive the Prize
Many scams will request a payment so you can receive your prize. If the sweepstake is legitimate, it will not ask for money in return for the prize. That is an immediate red flag. If a request for service fees, upfront charges or handling fees, it’s best to look into the prize more because chances are, it is a sweepstake scam.
It’s important to note that the taxes that need to be paid for a sweepstake prize are generally paid right to the IRS unless there are specific exceptions. If a sweepstake requests for you to pay taxes up front, chances are it’s a sweepstake scam.
2. Winning a Contest You Didn’t Enter
In order to win a contest, you have to enter one, so if you receive a notice that you won a sweepstake you didn’t enter, beware of a sweepstake scam. It’s very possible that you entered and just don’t remember and if there are no other red flags or your research comes up with nothing unusual, it may be safe to respond. If you are a person that enters sweepstakes regularly, print the confirmations or put them in a computer folder so you can refer back if necessary.
3. A Large Check Received In the Mail
Imagine the excitement of receiving a surprise large check in the mail. Unless it’s from a reliable source such as a friend, family member or job, it should definitely be questioned because it’s a good chance it’s a scam. Typically, the receiver will be asked to cash the fraudulent check and send the money via wire transfer or even deposit the funds in their account and send them to the scammer. It is illegal to cash a fraudulent check and is punishable by fines, account closure or even jail depending on the amount so it’s extremely important to do your research before cashing the check.
4. Scammers Request Funds Are Sent by Wire Transfer
Scammers tend to request that winners use wire transfer services like Western Union to send funds from a sweepstake scam. Basically, Western Union is like cash so once it’s sent to the scammer, it’s gone and will be hard, if not impossible to recoup.
5. Scammers Ask for a Hurried Response
Sweepstake scam con artists will ask a winner to respond extremely fast because they want to make sure the funds from the check you’ve deposited or cashed are received by them before the check bounces. They also want to catch the winner before they learn about sweepstake scams or report the scam to their bank and the police. The more you are pressured to immediately accept the prize or send the money, the more you should be concerned that you may be getting scammed. The only reason you should be rushing to respond is if it’s a specific type of contest, like answering a question quickly for a radio contest or something similar.
6. There Is a Request for Personal and Banking Information
If you are asked to send sensitive personal information such as bank account details, credit card number, social security number and date of birth, more likely than not, you are a part of a sweepstake scam. Do not provide these details to them because this is a huge red flag.
7. The Prize Is a Lottery Win
There is no way to win the lottery without purchasing a lottery ticket so if you win a lottery without purchasing one, chances are it’s a sweepstake scam. The notification for a lottery win is not a phone call from the lottery but by television, the internet or the newspaper. It’s also important to note that if you receive a win from a foreign lottery in the United States, that is also a scam. It is illegal to sell foreign lottery tickets across international borders so unless you’ve traveled abroad and purchased one, it’s a scam.
8. Scammers Pretend to Be a Government Organization
Many times, sweepstake scammers will pretend to be a government agency like the nonexistent National Sweepstakes Board. If you receive an actual sweepstakes win, it will be sent to you from the sponsor, not a government organization.
9. Prize Notification Received with Junk or Bulk Mail
Sweepstake scammers may use the mail as a way to send an illegitimate sweepstake win. You may notice a notification in your bulk mail that shows you’ve won a prize but an actual sweepstake win via mail will normally come from UPS or FedEx.
10. The Prize Notification Has Grammatical Errors
Sweepstake scams tend to have excessive grammatical errors. Every once in a while a company may send something with minor typos but if you receive a sweepstake notification with several errors, chances are it’s a scam.
How to Protect Yourself from Scams
Sweepstake scams are extremely common and it’s important to protect yourself and your assets or keep an eye out on them for the people you know.
1. Don’t share your personal information. No one from a sweepstake will ever ask you to provide sensitive information such as your social media or bank login information, bank account number or credit card details. Keep those details to yourself and never share them with someone you don’t know, especially if they claim to be from a sweepstake. Previous victims accounts have been drained and closed, credit cards maxed out and many end up owing large sums of money to the bank.
2. If you recognize you or someone you know is a potential scam victim, make sure to report it to the Federal Trade Commission (FTC) at FTC.gov/complaint. You may help someone else from falling prey to a scam.
3. Call to verify any suspicious sweepstake notification. If it seems too good to be true, it very well may be so if you have questions about a possible prize, call the sponsor to verify. Research their details online before assuming the contact information on the possible scam notification is correct because if it is a scam, they will encourage you to believe it’s not.
4. If you notice that there are no rules for entering a sweepstake and you’re unable to receive direct information, it’s a strong possibility you’re dealing with a sweepstake scam.
5. Beware of someone that asks you to cash a check and send them a portion back. A real sweepstake will never ask you to do this. Once you’ve sent the money, it’s gone and your bank account will be affected.
6. Scammers tend to call from an unknown number asking for sensitive information, also known as spoofing. If you sense the call is possibly a scam, hang up and either research the number or locate the details of the company to determine if they actually contacted you.
7. Many sweepstake scammers prey on elderly individuals. If they are being contacted by a scammer, report it to your local adult protective services office to help prevent others from being scammed.
Scammers prey on individuals they think are vulnerable and more willing to believe they have won. Their goal is to convince the potential victim that they are a winner, to send them money or to provide personal information. No matter how great a prize may seem, if you sense something is off or there are red flags, pay attention. Knowing the difference between a sweepstake scam and an actual win can save you time, money and loss.