Prize, sweepstakes and lottery scams: “you've won”
You've won a prize, but you have to pay taxes, fees or shipping before you can collect it.
Could you spot it?
2 quick examples. Decide scam or legit for each.
How it works
A call, letter, text or social media message says you've won a big prize or a lottery, sometimes one you don't remember entering. To claim it you must pay processing fees, taxes or insurance first, often by gift card or wire. The fees keep coming, and the prize never does.
Legitimate sweepstakes never ask winners to pay to collect.
Red flags
- You have to pay anything to get a prize.
- You “won” a contest or foreign lottery you never entered.
- Pressure to claim it right away, and to keep it quiet.
- Payment by gift card, wire, crypto or cash.
What it looks like
Your phone rings. You don't remember entering any contest.
Caller: Congratulations! This is the Prize Notification Department of the National Sweepstakes Bureau. You've won second place: $2.5 million and a brand-new luxury SUV!
Caller: To release your winnings, you need to prepay the taxes and insurance, $3,950. Most winners use gift cards or a wire transfer to speed it up.
Caller: Please keep this confidential until the press announcement. We've had problems with relatives trying to claim winnings.
The tells:
- A prize from a contest you never entered.
- Paying to receive a prize.
- Gift cards or a wire: unrecoverable payments.
- Secrecy, so no one talks you out of it.
A training example written for this site. Names, numbers and links are made up, and links are disabled.
What to do
- Never pay to collect a prize.
- Hang up, delete the message, or throw out the letter.
If you already paid or shared information
- Contact the company you used to pay (your bank, card company, gift card company, payment app or wire service) right away and ask them to reverse the payment.
- If you shared a password, change it now and turn on two-factor authentication.
- If you gave out your Social Security number or other ID details, go to IdentityTheft.gov for a recovery plan.
- Report it to the FTC at ReportFraud.ftc.gov. For scams that happened online, you can also report to the FBI at ic3.gov.
From FTC: What to do if you were scammed.
Latest alerts about this scam
- FTC ·Unclaimed life insurance money? It’s a scam
People are telling the FTC they’ve gotten letters in the mail from law firms about unclaimed life insurance money. It’s a scam.
Sources
- FTC: Fake prize, sweepstakes, and lottery scams
- FTC: Asked to pay to claim a million-dollar prize? Don't bet on it
Related scams
Utility shutoff threats
A caller or text from your “utility company” says service will be cut off within the hour unless you pay now.
Fake stores and too-good deals
An ad or website with prices that are too good to be true, from a store you've never heard of.
Fake charities
A fundraiser after a disaster or at the holidays, pressing you to give fast, by gift card, crypto or wire.