BBB fraud alert: Sweepstakes scams cost average elderly victim $11,500

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DENVER — The Better Business Bureau warns consumers, especially elderly people, that sweepstakes and lottery scams are major and costly problems in Colorado.

“The BBB receives numerous calls on a daily basis from hopeful citizens inquiring about the authenticity of a mail or phone notification offering a substantial prize,” the agency says. “Unfortunately, the BBB verifies they are always scams.”

This category of fraud is common across metro Denver and across the state of Colorado.

ElderWatch, a partnership between the Colorado Attorney General and the AARP Foundation, says complaints about prizes, sweepstakes and lotteries were tops on its list in 2013.

The average amount of money lost in such a scam in Colorado is $11,565 according to the BBB. The average victim’s age is 75.

The Federal Trade Commission says complaints about prizes, sweepstakes and lotteries ranked No. 6 on its list nationally.

How to identify a sweepstakes scam

Are you asked to make a purchase in order to get your prize? According to the Deceptive Mail Prevention and Enforcement Act, if you have won something, you should not have to pay a penny or purchase anything to receive it.

Are you asked to wire money? Many times scammers will instruct you to wire money to cover the fees, such as processing, administrative or tax fees, before you receive your prize. Once you’ve wired money there is very little chance of getting that money back.

Be cautious of look-alikes. Scammers often use names of government agencies and well-known organizations to try to confuse you and give you confidence in the winnings claim.

Did you receive this notification via bulk rate mail? According to the FTC, it is highly unlikely that you’ve won a big prize if your notification was sent by bulk rate.

Resources

Sweepstakes and lottery fraud attempts can be reported to ElderWatch online or by phone 1-800-222-4444, option 2.

Victims of mail fraud should contact the U.S. Postal Inspection Service online or by phone 1-800-372-8347.