Older Americans are increasingly becoming popular targets for lottery and sweepstake scams. According to the U.S. Senate Special Committee on Aging, lottery scams rank second on the list of fraud offenses reported by older adults, claiming thousands of victims each year.
These scams are also known as the “advance fee scam” and involve fraudsters issuing counterfeit checks and fake award letters to consumers alleging that they have won a lottery or sweepstake raffle. The individual is instructed to pay taxes and fees upfront in order to claim their winnings. Consumers who send the money soon find out that they haven’t won anything at all.
Older adults especially need to be weary of any reward letter and check they receive instructing them to pay upfront to collect their prize money. You should never pay a fee to win a lottery!
Before you participate in any lottery or sweepstake, keep these tips in mind:
Don’t be fooled by the appearance of the check. Scam artists use sophisticated technology to create counterfeit checks that mirror the appearance of legitimate checks. Some are counterfeit money orders, some are phony cashier’s checks and others look like they are from legitimate business accounts. The companies whose names appear may be real, but someone has dummied up the checks without their knowledge.
Never pay to play. There is no legitimate reason for someone who is giving you money to ask you to wire money back or send you more than the exact amount —this is a red flag that it’s a scam. If a stranger wants to pay you for something, insist on a cashier’s check for the exact amount, preferably from a local bank or one with a local branch.
Verify the requestor before you wire or issue a check. It is important to know who you are sending money to before you send it. Just because someone contacted you doesn’t mean they are a trusted source.
Ensure a check has “cleared” to be most safe. Under federal law, banks must make deposited funds available quickly, but just because you can withdraw the money doesn’t mean the check is good, even if it’s a cashier’s check or money order. Be sure to ask if the check has cleared, not merely if the funds are available before you spend the money.
Report any suspected fraud to your bank immediately. Bank staff are experts in spotting fraudulent checks. If you think someone is trying to pull a fake check scam, don’t deposit it—report it. Contact your local bank or the National Consumers League’s Fraud Center, fraud.org.
For more information about protecting your financial and personal information in our Simply Speaking blog section on LakelandBank.com.
