How to Recognize & Avoid Lottery Scams

We all find ourselves dreaming of winning the lottery. Sweepstake and lottery scams are a popular choice for scammers. They understand the desire we each have to be given a prize, money, or rewards.

They promise incredible wins while appearing to come from authentic sources. Let’s take a look into sweepstakes and lottery scams, how they happen, and how to avoid them.

How A Typical Lottery Scam Works

One classic sign of a lottery scam is that a person is notified of winning from a lottery or sweepstakes that they don’t remember entering. Lottery scams are often conducted through mail, phone calls, social media alerts, or text messages.

The coveted prize could be anything from a large sum of money, expensive tech items, or a luxury vacation. Scammers will often name their sweepstakes similar to well-known lotteries so the victim gains a false sense of security.

Everything sounds so exciting, and the victim is ready to be awarded their prize, but then things get tricky. In order to claim the prize, they are told that they must pay a fee that covers anything from shipping and processing to taxes or insurance.

The scammer tells the victim how to send the money, normally through a wire bank account transfer or a prepaid debit card. If the fee is paid, the victim often finds that the prize never comes at all or only comes in part before the scammer asks for you to pay another fee.

This process often repeats, and the scammer asks for money again, continually stalling the prize. If the victim is lucky to get a partial piece of the prize, the award often bounces after being deposited.

Another way the scam is executed is by asking the victim to call a phone number or click a link in order to claim the prize. Once the link is clicked, they may be asked to provide personal information like their Social Security number, bank account details, date of birth, etc. The link could also potentially download malware onto the person’s device. Either way, the person becomes more susceptible to identity theft.

Another recent trend scammers use is hacking into a victim’s Instagram, Facebook, or other social media accounts. Once logged in, they contact the person’s family and friends, share on their page, and send links that bring other people into the scam through one of their friends.

Because the victim’s family and friends trust the content they post, this makes people more likely to trust the scam and provide information that they would normally not disclose.

What Red Flags to Watch For

Avoiding lottery scams might seem tricky, but be on the lookout for these red flags to help you recognize a scam:

• You receive a notification saying you’ve won a lottery of sweepstakes that you know you never entered in the first place.
• You are told you must pay in order to collect your prize.
• You are asked to share personal information.
• You are told to call a specific number or click a link.
• The organization says you’ve won a lottery that was drawn overseas.
• The notification you receive contains a plethora of grammar mistakes.
• You are told to keep your winnings secret or confidential.

Ways to Protect Yourself From Lottery Scams

In order to avoid lottery or sweepstakes scams, here are a few guidelines to follow to keep yourself safe:

• Never share personal information online or over the phone. Ensure any webpage you need to share personal information on is verified and secure.
• Avoid clicking on links in emails that come from unknown senders.
• Never transfer or wire money to someone you do not know.
• If you get suspicious messages from family or friends. Verify the message with them personally before clicking or responding.

What To Do If You Are Targeted

If you end up finding yourself a victim of a lottery scam, here are a few steps to take to protect yourself from further fraud:

• Contact the Federal Trade Commission to inform them of the scam.
• If you have already shared information or money, contact local law enforcement.
• Visit the FTCs website to learn more about recovering from identity theft.
• Inform others of the scam to prevent further damage to those you love.

What To Know About Real Lotteries & Sweepstakes

While it may seem that there is a multitude of scams happening, there really are reputable organizations that hold sweepstakes and lotteries. Here is a list of a few attributes you will find with real giveaways, sweepstakes, or lotteries:

• Entering the sweepstake should always be free: In most cases, it is unlawful to require a purchase in order to be entered into a sweepstakes.
• The winner will always be chosen by chance: There should be nothing you can do to increase your chances of winning.
• Sweepstake promoters are required to tell you certain things if you ask: If you ask for information about how to enter, what the prize is and how the prize is distributed after the giveaway, they are required to give you answers.
• They have to say certain things: All mailed sweepstakes must say that you do not have to pay to enter. They also cannot say you are a winner if they are not going to give you a prize.

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This article is for educational purposes only. WeStreet Credit Union makes no representations as to the accuracy, completeness, or specific suitability of any information presented. Information provided should not be relied on or interpreted as legal, tax or financial advice. Nor does the information directly relate to our products and/or services terms and conditions.