Investigators

Sweepstakes, lottery scams on the rise, costing billions of dollars

RALEIGH, N.C. (WNCN) - There’s a new warning from the Better Business Bureau regarding sweepstakes and lottery scams.

A new study by the agency said fake sweepstakes and lottery scams are on the rise, and they’re costing billions of dollars.

The study said the schemes are continually evolving. They found they commonly originate in Jamaica, Costa Rica and Nigeria.

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The BBB said Jamaica is a major source of “cold calls” to victims who are told they have won money.

It said the scams have had a major impact in Jamaica, where the amount of money generated by lottery fraud has resulted in gang wars between rival fraud groups.

The report recommends stronger law enforcement efforts on three fronts:

  • In Jamaica, which has seen an increase in violence related to lottery fraud profits.
  • In the U.S. where law enforcement is urged to step up extraditions and prosecutions of overseas fraudsters operating in the U.S.
  • Globally, law enforcement agencies worldwide are encouraged to take steps toward holding deceptive mailing organizations accountable and stopping mail fraud. 

These scams begin with a phone call making the victim thinking free money is going to be rolling in the door for them.

But, in reality, the victim isn’t getting any money. In fact, the scammers are going to take money from them — lots of money.

The BBB said fake lottery and sweepstakes scams in the US and Canada took an estimated $117 billion out of the pockets of people like Allen Walker.

“They said congratulations Mr. Walker you've just won the Jamaican sweepstakes for $94,000 dollars,” he said.

But, in reality, Walker said he ended up losing over $5,000 to the criminals.

The BBB said these scammers are professionals who are working off-shore.

“Most of the people that are cold calling are from either Jamaica or Costa Rica," said BBB investigator Steve Baker.

The BBB’s scam tracker said nearly 2,820 people reported sweepstakes and lottery scams in 2017. That same year, CBS News reports, the FTC and the FBI combined received 145,881 complaints about those type of scams.

The BBB said technology has been the scammer’s best friend by allowing them to get victims' personal information through cold calling, text messages, internet pop-ups, the mail, and social media like Facebook.

“The fact that they have really migrated to social media means that that's a huge new audience that's being introduced to these,” Baker said.

Social media platforms like Facebook are trying to help.

Facebook told CBS News, "These scams violate our policies. We have a dedicated team and automated systems to help detect and block these kinds of scams."

The BBB's scam tracker allows people to look around their neighborhood for scams to avoid. It will show the number of scams in your area and break them down by the type. If you click a listed scam, you can get more details.

A few tips to remember are:

  • True lotteries or sweepstakes don’t ask for money before you claim a prize. If they want money for taxes, themselves, or a third party, they are most likely crooks.
  • Call the lottery or sweepstakes company directly to see if you won. Publishers Clearing House (PCH) does not call people in advance to tell them they’ve won. Report PCH imposters to their hotline at 1-800-392-4190.
  • Check to see if you won a lottery. Call the North American Association of State and Provincial Lotteries at 440-361-7962 or your local state lottery agency.
  • Do an internet search. Check the company, name, and/or phone number of the person who contacted you.
  • Law enforcement does not call to award prizes. Anyone who says they are doing a law enforcement giveaway is a fraud.
  • Talk to a trusted family member or your bank. They may be able to help you stay in control of your money in the face of fraudster pressure.

 

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