Too good to be true: prize scams and how to avoid them

Two and a half years ago, a Kittanning woman opened a letter from two men claiming to be employees at Publishers Clearing House, the sweepstakes company famous for surprising people at their homes with huge cardboard checks. She was floored – the letter said she had won $4 million.
To claim her winnings, the letter instructed her to send a $500 “processing fee” to an address in New York. Karen, who asked that her last name not be used, did just that, though she had to borrow a portion of the money from a friend. Since the letter assured her she would receive her cash shortly after mailing the fee, she wasn’t worried about paying him back.
But the requests for payment didn’t end there. Karen was then told she would have to pay $32,000 to insure the check against terrorism, since it was supposedly being sent to her across the Canadian border. But she hadn’t even been able to afford the $500 processing fee – how could she manage to fork over thousands of dollars?
When she reached out to one of the letter’s signees, he assured her this would not be a problem. He would connect her with somebody who could help with the payment. But he never followed through, and when Karen tried to call him again, an automated message said the number was out of service.
So Karen forgot about the whole affair – until last Christmas when she received an identical letter again from individuals claiming to be with Publishers Clearing House. Now she was suspicious.
“I kinda fell for it first, I guess,” she said. “But that’s when I thought, c’mon guys.”
Karen had been the victim of a sweepstakes scam, which, along with lottery and prize scams, is among the most serious and pervasive frauds in operation today, according to a recent study by the Better Business Bureau. Over the last three years, close to half a million people have reported this scheme to enforcement agencies in the United States and Canada. Reported losses in 2017 alone totaled $117 million.
And the actual number of victims and losses is likely to be much higher, reported the BBB, which is a private nonprofit that works to enhance marketplace trust. Washington County District Attorney Gene Vittone echoed this thought.
“A lot of people are embarrassed and won’t report it,” he said. He urged victims to report the crime, embarrassment notwithstanding.
The BBB reported scammers tend to target seniors at a higher rate. People between the ages of 65 and 74 also suffer the highest losses, as they are more likely to have recently experienced a “negative life event,” whether that be divorce or the death of a loved one.
To avoid falling victim to such a scheme, a spokesperson for the office of Pennsylvania Attorney General Josh Shapiro advised people never to pay upfront fees in order to claim a “prize,” agree to help a stranger cash a lottery ticket or share financial information with a caller, even if the offer seems legitimate. Spokesman Joe Grace said scammers use a tactic known as “spoofing” to mimic the phone numbers of legitimate businesses and agencies.
Grace also advised people to avoid offers that sound “too good to be true” and to remember that “honest people will not ask you to deposit a check, wire money or use prepaid gift cards to claim your winnings.”
“Take a minute to think or contact a loved one for advice,” he said. “Scammers will often create a sense of urgency and pressure you into paying a fee. Don’t fall for it.”
Karen urged people to check out sweepstakes or award announcements “as much as you can.”
“If they ask you to send them anything, don’t do it,” she said. “If they actually have something for you, they’re going to get it to you.”