Get the lowdown on the latest tricks in our lottery scams update -- plus the five simple rules to avoid them: Internet Scambusters #415
It seems there's no limit to the ingenuity of crooks when it comes to devising new lottery scams.
Even the well-known scam that claims you won a fortune has been updated to try to persuade victims into believing they really have won.
But the scam also involves other ruses including blackmail and phony ticket agents.
We have the details in this week's issue, together with some simple guidelines to avoid being taken in by these cons.
Let's get started...
Lottery Scams Rake in Big Winnings for Crooks
Americans hand over more than $120 million in lottery scams every year.
That's the word from the US Postal Inspection Service -- and that's purely an estimate.
Add in money wiring, credit card payments and the resultant identity theft and you can see why lottery scams place high in our annual Top 10 Scams chart every year.
And it explains why, despite repeated government warnings and media horror stories about individuals losing tens of thousands of dollars, the crooks keep on pumping out their lottery scams.
It's also one of the most frequently covered subjects here at Scambusters -- yet every time we review the subject, we turn up new versions of this old lottery scams trick, as well as some cunningly different approaches.
The old, familiar "You've won a fortune" lottery scams
We don't need to say much about this, by far the most common lottery scam. You can check back on some of our earlier issues for the lowdown.
Why Doesn't ScamBusters Ever Write About Lottery Scams?
The trick hinges on convincing someone -- by phone or email -- that they've won a fortune, then either telling them they have to pay fees or other charges to collect, or asking for bank details so the supposed winnings can be deposited.
In the first case, the money has to be wired and is never seen again; in the other instance, the crooks use the bank details for identity theft.
In an attempt to make themselves more convincing, scammers these days often use celebrity or official labels for the supposed lottery.
Recent instances include a bogus Princess Diana lottery fund while another used the name of TV celebrity Oprah Winfrey.
Scammers may also claim to be from a government department, calling to collect taxes or fees before they allow the winnings to be forwarded, or a big time insurer -- Lloyds of London in one recent case -- acting as a guardian of the winnings.
Blackmail lottery scams
This lottery scam targets company employees and depends on a victim's potential dishonesty.
The scammer calls an employee, claiming he's been unable to pass winnings from a corporate lottery to the firm and asking if, instead, he can forward payment to the individual whom he supposedly trusts to pass it to his employer.
The crook asks for the victim's bank account details and, soon after requests, an advance payment fee.
When the victim refuses, the scammer threatens to tell the employer or police that they were trying to steal the money.
You did "win" but the prize isn't worth collecting
In this lottery scam, you receive notification that you won a hotel stay, a cruise or a similar type of prize.
But you didn't really "win" it. This is an email or snail-mail spam message sent out to thousands.
The "prize" may be genuine but it's just a come-on for a whole variety of high-pressure tricks that will take money out of your pocket.
These may include timeshare presentations you have to attend or, again, supposed fees that sometimes amount to more than the value of the "prize."
Buy a book on lottery-winning secrets
These days, it's easy for anyone to publish an ebook -- a digital book that people pay to download from the Internet.
So how much would you pay for a book that purports to tell you how to win the lottery?
Nothing, we hope. Because, although historically some numbers have come up more often than others, statistically there's simply no way of predicting those magic figures.
And, let's face it, if the author knew how to win the lottery, why would they give the secret away? Surely, they'd just scoop up the winnings each week.
Bogus online lotteries and ticket agents
We can also blame the Internet for the mushrooming growth of the online lottery scam.
There are all sorts of legal restrictions beyond the scope of this report associated with playing lotteries online.
The plain fact is that, at least in the US, official state and federal lottery tickets are not directly sold online, though supposed agents may offer to buy them on your behalf.
It's fair to point out that some of these operate within the law and do just what they say they will do -- buy you a ticket.
But it's also true that these sites are not subject to any government oversight -- some of them are based overseas -- and you use them at your own risk.
The trouble is that there are also plenty of crooked sites out there too -- not only posing as agents but also, in some cases, claiming to run lotteries of their own.
You may have to give these sites credit card details (with the risk of identity theft), you have no way of knowing if they ever bought/issued the tickets, or, if they did and you won, whether they'll pass the winnings to you.
Sites fronting international lottery scams often quote fantastic odds, making it appear you have a high chance of winning when, in reality, you have none at all.
You won but you don't collect
Several incidents have occurred recently in which lottery winners presented tickets to an agent -- say at a convenience store -- only to be told either that they didn't win or that the prize is much smaller than it should be.
In one case, a victim allegedly received a $2 payout for a ticket worth $1,000, while the crooked agent tried to pocket the balance.
Unfortunately for him, the "winner" was a state lottery security official and the incident was a sting.
The collateral game
In this lottery scam, a crook claims to have a winning ticket but tells the victim, often a passerby and usually elderly, he needs a large amount of cash as collateral to collect.
If the victim will lend him the money for just a few minutes, he can collect the winnings and will then pay a big bonus to his helper.
Sound too phony to fool anyone? This past October, an elderly woman parted with $60,000 to just such a scammer.
Simple rules to play by
You can check our earlier issues for more detail on how to avoid lottery scams but, for now, here are five simple guidelines that respond to some of the issues we've dealt with here:
- Never pay money either to supposedly collect winnings or to help someone else to do so.
- Buy your tickets at official state and federal lottery outlets and agents.
- Don't play overseas lotteries online or offline.
- Check for winning numbers (and winnings!) with the official lottery website or by phone.
- Pass it on.
Finally, an interesting story that harks back to the warning about not collecting on your winnings...
Police in Canada recently arrested three members of a family alleged to have illegally picked up, and largely spent, a $12.5 million lottery prize.
Now they're looking for the real owners of the winning ticket. At the time of writing, 20 different people had laid claim to it! So much for honesty. Lottery scams, it seems, know no boundaries.
Time to conclude for today -- have a great week!