The Powerball jackpot has reached $700 million, making it the second largest in U.S. history.
Unfortunately, the added attention may cause scammers to take advantage of consumers. The Powerball winners are announced on television and online, but consumers may be contacted by scammers reaching out via email, telephone and snail mail to “inform” secondary winners of smaller prizes.
Usually, targets of a lottery scam are asked to pay taxes or other fees upfront before they can claim their “winnings.” However, once they make the payment (or several payments), the big prize never materializes and the scammers are nowhere to be found. In another variation, the target receives a congratulatory letter in the mail informing them of the big win. Included is a check to cover the taxes on the winnings. Victims are instructed to deposit it into their bank account and then send the money to a third party, usually by wire transfer or prepaid debit card, which are largely untraceable. The lottery check is a fake that bounces and the victim is out the money.
Here are BBB’s tips to avoid lottery scams:
- Don’t pay up to claim your prize. You should never have to pay money or buy products in order to receive a prize. Be especially wary of requests to send money via wire, prepaid debit card, gift card or other unusual forms of payment.
- Be wary of email announcements. Major sweepstakes organizations sometimes email about smaller prizes, but for big winners they usually show up at your house with a big check (and a camera crew).
- You can’t win a contest you didn’t enter. You need to buy a ticket or complete an application to participate in a contest or lottery. Be very careful if you’ve been selected as a winner for a contest you never entered.
- Verify — but not by using a source the scammers give you. Check if an offer is real, but don’t call the phone number in the email or website you suspect may be a scam. If it is a con, chances are the person on the other line will be involved, too.