Lottery Scams Prey On Your Hopes

Lottery scams trick you into thinking you've won to steal from you.

What would you do if you won the lottery? Whether your answer is practical, fun, or a little bit of both, just about everybody would be excited to have a few million spare dollars. Scammers know that, too. So they use lottery scams and other variations of sweepstakes and giveaway scams to capitalize on that. They hope you’ll be so excited about your win that they can trick you into sending them what they want.

How Lottery Scams Work

Lottery scams are very straightforward. First, a scammer contacts you in some way. This may be a phone call, an email, a text message, a message on social media, or even a physical letter or postcard mailed to you. They tell you congratulations, you won! Often they claim that you’ve won the lottery (hence the name “lottery scam”), but sometimes they claim it’s a different contest or sweepstakes. The prize may be money, or it may be something like a new car, a vacation, or an iPad. In some cases, the prize is actually quite small.

The scammer hypes you up and gets you excited about your win. Then they hit you with the catch. There’s something you have to do before you can get your prize. Most commonly, there’s some kind of fee they say you have to pay first. Or they may need some personal information to “verify your identity.” You know what happens from here. The promised prize never materializes, and the scammers disappear with all the money you sent for fees. If you gave personal information, they may steal your identity while they’re at it.

This often isn’t one-and-done, either. The scammers will try to keep you on the hook as long as possible with claims of issues. There might be surprise fees, taxes, or even bribes, all needing you to send more money. Many people keep going out of hope they’ll get the promised prize. When they start to resist, scammers may move to a second phase. They’ll call pretending to be the IRS, police, or a private investigator. They’ll tell you the lottery was a scam, but they’re investigating. And they can give you back your stolen money if you just pay a fee. They’ll keep going as long as you keep paying.

Lottery Scam Tactics

Since the scam is so straightforward, there are a lot of similar tactics that lottery scams use. They may claim to be from a government agency. This may be agencies that don’t actually exist, like the “National Sweepstakes Bureau,” or real ones like the Federal Trade Commission. Sometimes they claim to be representing a foreign lottery. They may also impersonate genuine, trustworthy companies that run real sweepstakes, or use the name of an actual lottery or lottery game.

Some scammers put in a little extra effort. They get your information from phishing attacks or data breaches and use that to personalize their stories. If it looks like it’s being sent directly to you from an organization who knows who you are, many people find it more trustworthy. If part of their goal is stealing your identity, they may also ask for your passport, driver’s license, and/or social security number under the guise of verifying you’re really the prize winner.

Another common tactic is second chance drawings. Whenever a big lottery drawing happens and nobody wins, scammers put these tactics out there claiming that you could win on a “second chance drawing” from that lottery. They’re hoping that you bought a ticket and would be excited about potentially winning after all. In reality, unclaimed prize money in big lottery games gets returned to individual states. There’s no such thing as a second chance drawing.

Red Flags and Warning Signs

The biggest warning sign of a lottery scam is if you have to pay to receive your winnings. Scammers make up all kinds of stories where the fee sounds reasonable. Taxes, shipping fees, processing fees, customs, foreign winner fees from out-of-country prizes, and more are common stories. But real lottery winnings are free. If they want you to give money to collect your prize, it’s a scam.

Another warning sign is if you have to provide personal information either to enter to win or to collect your prize. There’s no real reason a contest or lottery will want your bank information, social security number, credit card information, or anything else. Sometimes scammers claim they need to verify that you’re the real winner and want a copy of your passport or driver’s license. Any of these ploys are scams. Don’t give them your information.

Also be wary of common signs of a scam. Pressuring you to act is a red flag. So is making it sound urgent, like you have to act right now. Weird payment methods are also suspicious. No legitimate lottery or prize would want fees paid with wire transfer, MoneyGram, a payment app, gold, cash, gift cards, or cryptocurrency. And if they tell you to keep your winnings confidential, that’s a scam.

If the notification came through the mail, check to see if it’s a bulk mailing. Is your name on it? Is the postage mark a bulk rate? If there’s no name (or something generic like “winner”) or the postage is bulk rate, that’s not sent specifically to you. It’s a mass mailing scammers sent to many people.

Finally, do you remember entering that lottery or sweepstakes? Nobody wins a contest they didn’t enter. If you didn’t enter, you definitely didn’t win. It’s a scam.

How to Avoid Lottery Scams

The best thing you can do to avoid lottery scams is to know the facts about lotteries and prizes.

Nobody wins something they didn’t enter. If you didn’t enter the raffle, lottery, sweepstakes, competition, or whatever it is, you didn’t win.
Real lotteries won’t reach out to you. If you win, it’s up to you to notice and take your winning ticket to them to claim your prize.
It’s illegal for a genuine sweepstakes to let you pay to increase your chances of winning.
It’s illegal for a US citizen to play a foreign lottery. Even if you did genuinely win that foreign lottery, it’s a crime.
No legitimate prize will make you pay any fee or give up your personal information to claim it.
Taxes get paid to the government, not to the lottery company.

As with all scams, remember that if it sounds too good to be true, it probably is. Be critical and cautious. It’s exciting to be told you’ve won something, but always look out for the catch. Do your research first. Search for the company or organization’s name online with the term “review,” “complaint,” or “scam.” And remember that just because the message is from a well-known and trusted company or lottery organization doesn’t mean it’s trustworthy. Scammers are great at imitating real organizations.

Report the Scam!

If you encounter a lottery scam, whether or not you lost money to it, you can report it. Reporting scams is critical because it helps law enforcement catch and prosecute scammers and allocate the right resources to fighting them. If you lost money, it can also be a record that you were a victim so you can get some of your money back if the scammers get caught.

Check out our Scam Report Preparation Guide to prepare for the reporting process. Mostly, reports want as many details as possible. Dates, any names or information they gave you (even if fake), phone numbers or email addresses they used, what they told you, how they wanted paid, and any other information you can remember could be helpful.

No matter what happened, report the scam to your local police, the FTC at reportfraud.ftc.gov, and your state’s Attorney General. If they contacted you through the mail, report it to the US Posal Inspection Service at uspis.gov. Phone calls can be reported to the FCC at consumercomplaints.fcc.gov. If they contacted you through email or social media, report it to the FBI at ic3.gov. And if they pretended to be with a certain company or lottery, report it to them, too. Many of them take impersonation very seriously. All of this will help stop these scams and hopefully bring the scammers to justice.