A lottery scam is any type of fraudulent activity where a criminal attempts to extract money or personal details from a victim by pretending to represent or have an association with an official lottery organization.
Lottery scams are among the most widespread types of fraud and are very lucrative for the perpetrators. Enforcement agencies reported that people living in the U.S. and Canada lost a total of $117 million to lottery scams in 2017 alone, and advised that the actual figure would probably have been significantly higher if all scams were reported.
Although lottery scams are becoming more sophisticated, they are easy to spot if you know what to look for. Most importantly, remember that you cannot win a prize in any lottery, sweepstake, raffle or contest that you haven't entered. Furthermore, lottery providers will never make you pay taxes or fees before you receive your winnings - taxes are paid only to the government after you make your claim.
Powerball scams can take many different forms, but they do share some common characteristics. If you notice any of the below in a message or call about lottery winnings, you should take it as a red flag and proceed with caution.
Powerball scams can come in many forms. You may be targeted via phone call, text message, letter, email or even through social media. The following list outlines some of the most popular communication methods used for lottery scams, but note that this list is not exhaustive, as scammers are constantly coming up with new ways to cheat people out of their money.
Phone Scams: A fraudster will call you over the phone and say they work for Powerball or a state lottery which runs the game. Their first objective will be to assure you that you’re speaking to an official lottery representative, and they will do this by quoting meaningless reference numbers or ticket information, details about the lottery you’ve won and even names and contact numbers of others within the organization.
Once they’ve done this they will say that some sort of fee is needed to process the prize claim and that you need to pay this as soon as possible, otherwise the claim will expire. This is to pressure you into acting on impulse, and they count on the fact that most people wouldn’t want to miss out on a large amount of money just because they hesitated.
Phone scams commonly target older or more vulnerable people, as they’re more likely to trust that the person at the other end of the phone is from a genuine lottery provider.
Scammers commonly dial from specific area codes originating from outside the U.S. Jamaica does not offer Powerball but has been a major source of lottery scams over the past few years. Callers often impersonate the Publishers Clearing House Sweepstakes and tell people they have won a large prize. Jamaica’s area code is 876 so it is a good idea to check the caller ID before picking up, although scammers can make it look like they are calling from inside the U.S. There have also been a growing number of cases of lottery fraud originating from Costa Rica.
Fake Ticket Scams: Another type of scam involves the sale of fake lottery tickets. These scammers will offer you a number of lottery tickets for a very low price, and will often enact these scams over the phone, as there is no paper trail. The cost of the tickets will be low enough to make it tempting to a lot of people, but it will be high enough for the scammer to make money off just a few calls. For example, you might be offered 100 Powerball lines for $10, which works out at just 10 cents a line. This in itself should be a warning sign, as no legitimate lottery provider would offer lottery tickets for next to no cost.
These scams will often solicit payment for the tickets immediately, and you will be encouraged to hand over bank details or credit card details over the phone. Once the scammers have this information, there’s no telling how much money they might siphon out of your account.
Mail Scams: A letter is sent with information about a huge Powerball win, asking you to mail back a portion of the money in order to receive the full sum. The letter will often say that you must respond immediately, otherwise you will lose the prize.
It is often elderly people who are targeted in these type of scams, and it may be people who have previously given money to other scams and have found their way onto “victim” lists. Victims may only send small amounts each time, but if they keep falling into the trap the losses can run into the tens of thousands of dollars.
Email Scams: Much like mail scams, an email scam will attempt to convince you that you have won a huge amount of money, but that you must cover vague "taxes" or "fees" if you want to receive the cash. There may be a link to a website where you can "claim" the prize, which could contain malware that allows scammers to access personal information on your computer. Fraudulent emails can look very authentic and may even link to clones of official websites. They are becomingly increasingly common as the criminals can send emails to lots of people at little or no cost.
Some scam emails may seem innocuous, only asking you to reply with a few personal details such as your name and date of birth, but if you were to send this information it would flag to the scammers that you might be open to disclosing further, more important information with a little more coercion.
Cell Phone Scams: You receive a text message from an unknown number saying that you have won a Powerball prize, and that you need to call the number back to arrange claiming the money. If you do call, you may find yourself on the phone to a premium rate service and facing a steep phone bill. The premium rate service has been set up by the scammer so they can make money from you just for calling, even if they cannot convince you to give up personal or financial information.
Social Media Scams: You receive a message on Facebook, Twitter or another platform telling you that your account was selected to win a Powerball prize, and that you need to follow a specific link to make a claim. You are told that you need to act as soon as possible to receive the winnings, but after paying the "fees" necessary, the funds will never appear.
Fraudsters can also use social media to pose as real winners. They have been known to set up accounts on Facebook, Twitter or Instagram using the name and picture of a famous winner, offering money to anyone who shares personal information such as their name, address, and email address.
If you think you might have come across a Powerball scam or have been contacted by a fraudster, you should act in the following way to make sure you do not become a victim:
Powerball offers some of the biggest jackpots in the world, but the only way to have a chance of winning is to buy tickets from an official retailer. Don't fall victim to a scam!