Lottery scammers use car dealer to help fool victims: Internet Scambusters #703
Lottery scammers are becoming more cunning than ever, finding new ways to convince victims they've genuinely won a fortune.
In this week's issue, we'll explain what they're up to and how you can avoid the tricksters by applying one simple rule.
We also have a warning from the FBI of an alarming increase in a costly financial crime.
Now, here we go...
Latest Lottery Scam Tricks More Convincing Than Ever
Lottery scams cost Americans an estimated $300 million every year.
That's the amount that victims -- mostly seniors and other vulnerable individuals -- shell out in advance for supposed taxation and processing charges so they can pick up their "winnings," which, of course, never arrive.
And despite stories appearing in local media every day about these costly con tricks, there's apparently no shortage of people still prepared to believe they've really won.
In one instance last November, a Jamaican man was sentenced to 20 years in jail in North Dakota for selling lists of gullible targets for lottery scams.
He was also ordered to pay more than $5 million in restitution to victims who had paid money to enter non-existent lottery competitions.
Even attempts by family and friends to warn potential victims that they're on the receiving end of a scam sometimes fail to convince some of them.
One reason is that the crooks are getting even better at tricking people into believing them, notably by using the name of one of the best-known legitimate names in the prize-draw business, Publishers Clearing House, which we've written about previously in One Simple Rule to Avoid a Lottery Scam.
A new example of how far these tricksters will go to convince victims happened recently in Idaho.
According to the Idaho Statesmen, a scammer posing as the son of a couple, told a car dealer his folks would be in later that day to select a car that he (the son/crook) would be paying for later as a surprise.
He seems to have asked the dealer not to mention that he would be paying.
The couple showed up and selected their car, leaving it to be detailed for future collection.
The crook called the dealer again saying he didn't have time to make the payment but would do it the following day.
But when they were ready to collect, the couple told the dealer they had won the vehicle as part of a lottery prize and had just paid their fees to the supposed lottery organizer.
The dealer then had the tough job of telling them that the car hadn't been paid for and that he'd thought their son was buying it for them.
At this point, they confessed that because it all seemed so real, especially as they'd had to select a car, they had wired the scammers $14,000.
In fact, lottery tricksters often use the lure of a car prize to add to the credibility of their story, usually a Mercedes, often because a car is a tangible thing -- we can all picture one in our minds, which somehow makes it seem more real.
Another sneaky trick we've encountered recently happens when the victim doesn't have enough accessible cash to pay the bogus processing fees.
First, the crooks will often try to convince the victim to borrow the money and, if that doesn't work, they've been known to try to rope them into their scheme.
For example, a California woman was told she could work off the $20,000 fee she needed to pay to get her winnings by cashing checks for the non-existent lottery company.
In reality, she was being set up to become a money-mule -- a third party who would receive checks from other victims, cash them and then wire the money untraceably to the crooks.
The victim allegedly agreed to do this but was eventually caught out when one of the checks she received bounced and her bank held her responsible for the money she'd withdrawn to wire to the scammers.
A third new trick uses the names of U.S. government departments as a tactic to try to convince victims.
Using stationery with logos from the FBI, General Accounting Office and Internal Revenue Service, they tell victims they've won millions in the "Gold Rush International Senior Citizens Sweepstakes."
Once again, victims are told they must pay tax on their winnings first. In some cases, phony U.S. Treasury checks seem to have been used to convince recipients of their authenticity.
There are many ways of avoiding a lottery scam but, as always, there's one golden rule that will always keep you in the clear:
Never pay money to receive competition winnings because no genuine competition organizer works that way.
While you may have to pay taxes on winnings, these are either deducted from winnings before they are paid to you, or you pay the IRS after collecting your prize.
Avoiding a lottery scam is as simple as that.
Alert of the Week
The FBI has warned of a huge increase in CEO fraud, where hackers spoof an email to a key financial employee from their boss, telling them to redirect a payment - straight to the scammers.
The crime has lost firms more than $2.3 billion in more than 17,000 scams during the past three years and in the past year alone incidents have rocketed by 230%.
If you get this type of message seemingly from your boss, double check it with them.
That's it for today -- we hope you enjoy your week!