Schemes and Rip Offs: Sweepstakes Scams - Valley News Live - KVLY/KXJB - Fargo/Grand Forks

Schemes and Rip Offs: Sweepstakes Scams

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Publishers Clearing House Sweepstakes' envelopes began hitting mailboxes this week, and that means scam phone calls and fake emails are soon to follow.

Rumors started flying around Richland County a few weeks ago that someone had won $10 million dollars from Publishers Clearing House.

A man claiming to be from the Prize Patrol even showed up in Mooreton looking for the lucky couple, lucky in this case because they didn't fall for the con.

Whether the crooks use PCH or some other sweepstakes or lottery the scam works pretty much the same:

You've allegedly won a big cash prize, you just need to pay some sort of fee or tax to retrieve the money.  That's the big tip off.

It's illegal for a company to charge you for winning and any taxes should only be paid directly to the IRS.

So what should you do?

First, if you receive any phone calls, emails or letters indicating you have won a prize but need to send money: don't do it!

Second, report the scam to your local police.

In the recent Richland county case the crook asked the couple to wire $3,000 through Western Union to pay for the taxes on the prize.  And other than that they say his story was very convincing.

Publisher's Clearing house offers a phone number you can call to verify whether you've really won a prize: 1-800-459-4724.  It's open Monday - Friday 7:30 a.m. to 7:30 p.m.


Top Warning Signs of a Sweepstakes Scam

Winning a large sweepstakes prize is a dream come true for many people. However, that dream can quickly turn into a nightmare if the win notification was actually a sweepstakes scam. The consequences of sweepstakes scams can be severe. By learning to recognize the top warning signs of a sweepstakes scam, you can avoid becoming a victim of fraud.

On the other hand, there are some things that might seem unusual, but which are commonplace for sweepstakes notifications. See Top Things that Aren't Signs of Scams for more information.

1. Sweepstakes Scams Require You Pay to Receive the Prize

Legitimate sweepstakes will never ask you to pay fees to participate or to receive a prize. You should never have to pay handling charges, service fees, or any other kind of charges up front to receive a win - those are sure signs of sweepstakes scams.

Sweepstakes taxes are paid directly to the IRS along with your regular tax return, except for rare exceptions such as paying for port fees or hotel taxes. For more information, read the article, "Top Questions about Sweepstakes Taxes."

2. Sweepstakes Scams Use Free E-mail Accounts
It's possible that some smaller, legitimate sweepstakes sponsors could notify you with a free email address. But if you receive a win notice claiming to be from a big company like Publishers Clearing House or Microsoft, but the email arrived from a free account like Hotmail or Gmail, you can be sure that you are working with a sweepstakes scam.
3. Sweepstakes Scams Tell You You've Won - But You Don't Recognize the Contest

You can only win sweepstakes that you enter. This is another reason why it makes so much sense to organize your sweepstakes entries; when you receive a notification, you can easily check to make sure that you actually entered that sweep.

To be absolutely sure, look up the telephone number for the sweepstake sponsor, and call and verify your winnings. Do not use a telephone number given in your win notification unless you can verify that it is legitimate from another source like a phone book.

4. Sweepstakes Scams Send You a Large Check with your Notification

To fool people into thinking that a sweepstakes scam is legitimate, many con artists send counterfeit checks along with their phony win notifications. Cashing fraudulent checks is a crime, and you could be liable for fines and even closure of your bank account, as well as losing any money you wire. Legitimate sweepstakes require affidavits before sending out any prize valued at more than $600.

5. Sweepstakes Scams Instruct You to Wire Money

Criminals love to use services like Western Union to receive illicit funds, because it is nearly impossible to trace who received the money. Western Union transfers are handled like cash, and it is nearly impossible to get back any money that you send to con artists in this way. In the few cases where you have to pay money to a sponsor, you would not be required to use a wire service.

6. Sweepstakes Scams Pressure You to Act in a Hurry

Sweepstakes scammers have a very good reason for wanting you to act quickly: they want to ensure that they receive their money before their check bounces or you read an article like this one and realize that you are being defrauded. If you feel like you are being pressured to make a decision before you have the time to ensure that the win is legitimate, you should be very suspicious. In some cases, a sponsor might need a quick answer (for example, if they are giving away tickets for a concert that weekend), but you should always have at least a few hours to investigate the notification. If there is no good reason for a rush to accept a prize, then it's probably a sweepstakes scam.

7. Sweepstakes Scams Require Bank or Credit Card Info to Receive Your Prize

Legitimate sweepstakes do not send wins by direct deposit, nor do they need to withdraw money from your bank or verify information using your credit card number. The only sensitive information that a legitimate sweepstakes sponsor needs to process your win is a social security number. Asking for a bank account or credit card number is a huge red flag that you are dealing with a sweepstakes scam, and you should never hand over this information.

8. The "Win" is From a Lottery

It is impossible to win a lottery without buying a ticket, and even in that case, you'd have to find the winning numbers in a newspaper, the Internet, or on TV and compare them to your ticket; the lottery does not contact you to tell you that you won. If your win notification says you've won a lottery, you can be quite sure that it's really a sweepstakes scam.

Win notices from foreign lotteries are even more suspicious. Not only do foreign lotteries have the same restriction as domestic lotteries, but it is also illegal to sell tickets for foreign lotteries across international borders. Therefore, unless you were actually in a foreign country and bought a lottery ticket, foreign lottery notifications are surely sweepstakes scams.

9. Sweepstakes Scams Often Don't Use Your Name
Especially in the case of email win notifications, many sweepstakes scams send thousands upon thousands of fake emails to every address they can get their hands on - often without knowing the name of the people they're contacting. If your win notice has a generic salutation like "Dear Sir" it's a good indication that it's a sweepstakes scam.
10. Sweepstakes Scams Can Pose As Government Organizations

To appear more legitimate, some sweepstakes scams pretend to come from government organizations such as the FTC or the "National Sweepstakes Board" (which doesn't actually exist). Real sweepstakes sponsors, however, send their win notifications directly to the winners. Government organizations are not involved in awarding sweepstakes prizes.

11. Sweepstakes Scam Notifications Are Usually Sent Via Bulk Mail

When a legitimate sweepstakes sponsor sends out win notifications, they want to ensure that the information arrives at the winners' doors in a reasonable amount of time. To make sure this happens, they use first class postage or services such as FedEx or UPS to deliver notifications. (Read more about prize notification methods.)

Sweepstakes scam artists, on the other hand, want to target the most people for the least cost in order to keep their profits high. They send scam letters out by bulk mail to take advantage of the postage savings. For this reason, you should never trust a win notification that arrives by bulk mail.

12. Sweepstakes Scams Contain Many Typos

It's possible that any company could make a mistake when typing out a win notification. However, glaring errors in spelling, grammar, and punctuation should set off red flags in your mind. Many sweepstakes scams originate outside of the United States and Canada and are created by people with poor command of the language. Be very cautious of any win notices that have a lot of errors.


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