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Sweepstakes Scams
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Facts for Consumers from the Federal Trade Commission
Sweepstakes Scams: When "Winners" Lose Money -- September 1993
If someone calls to say that you've won a trip or valuable prize
in a major sweepstakes, it may sound like a dream come true. But
listen carefully.
If you're told to send money immediately to collect the prize,
don't do it. Instead of winning something, the Federal Trade
Commission (FTC) warns that you could lose hundreds of dollars.
This brochure explains how you can tell whether you truly are a
sweepstakes winner or the target of a scam.
Recognizing a Scam
In recent months, fraudulent telemarketers have been posing as
representatives of the major sweepstakes, such as American Family
Publishers, Publishers Clearing House, and Reader's Digest. If
you become a target, you may receive an official-looking letter
that instructs you to call an '800' number. Or, you may receive
an unexpected phone call.
You may think the notification means you've won a prize,
especially if you've already entered one or more sweepstakes.
However, watch out if you're told to:
* Pay money upfront
You may be asked to send several hundred dollars _ by overnight
delivery services or Western Union _ to "prepay taxes," make a
"refundable" deposit, or cover shipping and handling costs. This
is a clue to a questionable offer. With legitimate sweepstakes,
you do not have to pay anything to collect your prize. If you
have won merchandise, like a necklace or car, the sweepstakes
promoter will pay the delivery charges. If you win cash, the
sweepstakes promoter either will withhold taxes from the cash
award or report the winnings to the Internal Revenue Service.
Overnight delivery services may be used in fraudulent schemes for
several reasons. The scam operators may want to get your money
before you become suspicious and change your mind. They also may
avoid mail fraud charges by using a courier.
* Give a credit card number
To show your eligibility, you may be asked for your credit card
number. Never give your credit card number over the phone to
someone you do not know. The number may be used to make
unauthorized charges on your account. Legitimate sweepstakes do
not need your credit card number to award a prize.
* Take action immediately
High pressure tactics may be used to get your money quickly and
give you little or no time to verify the caller's identity. Be
especially wary if you're called during evenings or on weekends
when you will not be able to call legitimate sweepstakes
promoters.
Checking it Out
If you are contacted by someone who says you have won a major
sweepstakes _ and they ask for money or your credit card number _
call the sweepstakes promoter yourself to verify any winnings.
For the phone numbers of some major sweepstakes, see the box
below.
Publishers Clearing House
1-800-645-9242
American Family Publishers
1-800-237-2400
Million Dollar Dream Sweepstakes
(Time, Inc.)
1-800-541-1000
Reader's Digest Sweepstakes
1-800-234-9000
Getting More Information or Filing a Complaint
If you have questions about a sweepstakes promotion _ or if you
think you've been victimized by a sweepstakes scam _ call the
National Fraud Information Center at 1-800-876-7060 (9 a.m. - 5
p.m. EST, Monday - Friday). Also contact your local consumer
protection agency or attorney general's office.
In addition, the FTC would like to hear from you. Write:
Correspondence Branch, Federal Trade Commission, Washington, DC
20580. Although the FTC does not handle individual disputes, the
information you provide may help the agency in its enforcement
efforts.
(Downloaded from CompuServe's Consumer Forum (go SAVE) )
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