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Scammers notify victims they've won a major sweepstakes or lottery they never entered, demanding upfront payments for fabricated taxes or processing fees. $351M in reported losses in 2024 (FTC), with 80% of money lost coming from consumers over 65 (BBB). Older adults 80+ face median losses of $1,650 per incident.
Annual Losses
$351M reported to FTC in 2024; $102.2M reported to FBI IC3 in 2024
Avg Loss / Victim
$1,000 median across all ages; $1,650 for adults 80+ (FTC 2024 Data Book)
Primary Vector
Phone calls, email, SMS, and physical mail (often impersonating Publishers Clearing House)
Peak Season
Q4 holiday season (Nov-Dec); also spikes around tax season
You receive a call, text, email, or letter claiming you've won a massive prize — cash, a car, or a vacation — from a recognizable brand like Publishers Clearing House, a state lottery, or an 'international lottery board.' The catch: you must pay 'taxes,' 'processing fees,' or 'shipping costs' before the prize can be released. These fees are demanded via gift cards, wire transfers, or cryptocurrency. Once paid, new fees are invented. The prize never existed. 80% of money lost in sweepstakes scams comes from consumers over 65 (BBB).
Hover or tap the highlighted text to see why each element is a red flag.
CONGRATULATIONS! You have been selected as a winner in the Publishers Clearing HouseRed flag: PCH is the most impersonated brand in prize scams. Real PCH winners are notified in person by the Prize Patrol — never by phone, email, or text National Sweepstakes! Your prize: $2,500,000.00Red flag: Large, specific prize amounts create excitement that overrides critical thinking. To process your claim, a one-time processing fee of $499.99Red flag: Legitimate sweepstakes NEVER charge winners a fee to claim prizes. This is illegal in the US and Canada. is required. Contact Claims Agent Robert JohnsonRed flag: Fake name to create false personal connection at 1-888-555-0231. Claim Reference: PCH-2026-7734Red flag: Fake reference number to add false legitimacy
From: prize-distribution@international-lotto-board.org Subject: OFFICIAL NOTIFICATION: You are a Winner! Dear Beneficiary, The International Lottery BoardRed flag: This organization does not exist. There is no legitimate 'international lottery board', in conjunction with the Federal Trade CommissionRed flag: The FTC does not administer lotteries or sweepstakes. Invoking a real agency name is a trust manipulation tactic, is pleased to announce you have won $5,000,000.00 in our Q1 automated drawing. Your funds are held in escrow. To release, remit a 1% processing fee via Apple Gift CardsRed flag: No legitimate organization collects fees via retail gift cards. Gift card payment = scam, always. Reply with gift card numbers and PINsRed flag: Asking for gift card PINs is how scammers drain the card value instantly within 24 hours or forfeitRed flag: Artificial urgency to prevent you from thinking clearly or verifying the prize.
You 'won' something you never entered
You cannot win a contest you didn't enter. This is the single most reliable indicator of a prize scam.
You must pay a fee to claim your prize
Legitimate sweepstakes are free to enter and free to claim. It is illegal in the US to require payment to collect winnings.
Payment demanded via gift cards, wire transfer, or cryptocurrency
These methods are untraceable and non-reversible. No legitimate organization uses them to collect 'fees.'
Claims to be Publishers Clearing House but contacts you by phone/text/email
Real PCH notifies major prize winners in person via the Prize Patrol. They never call, text, or email to notify winners.
References real organizations (FTC, IRS) to seem official
Scammers name-drop real agencies to borrow credibility. The FTC and IRS do not administer sweepstakes.
Pressure to act quickly or lose the prize
Real prizes don't evaporate in 24 hours. Urgency prevents you from verifying the claim.
They ask for bank account info for 'direct deposit of winnings'
This is identity theft — they want your bank details, not to send you money
After paying one fee, additional fees are required
This is the escalation pattern. Each new fee is designed to exploit the sunk cost fallacy — you've already invested, so you keep going hoping to recoup.
Legitimate sweepstakes (like the actual Publishers Clearing House) never ask winners to pay fees, taxes, or shipping costs to claim prizes. For major prizes ($10,000+), PCH notifies winners in person via the Prize Patrol without advance warning by phone or email. For smaller prizes, they send a check directly by certified mail. Legitimate lotteries deduct taxes from winnings before paying or provide an IRS form so you pay taxes directly to the government. You never need to buy gift cards to claim real winnings.
It's theoretically possible with legitimate sweepstakes you may have entered online. But legitimate winners are NEVER asked to pay fees. If anyone asks you to pay to claim a prize, it's a scam — period.
Taxes on legitimate prize winnings are either deducted from the prize before you receive it, or you receive an IRS W-2G form and pay taxes yourself through the normal tax filing process. You never pay 'taxes' to a prize company via gift cards or wire transfer.
No. There is no prize. Each new fee is designed to exploit the sunk cost fallacy — the feeling that you've invested too much to walk away. Every additional payment is money lost. Stop immediately.
BBB research shows 80% of money lost in sweepstakes scams comes from consumers over 65. Scammers target older adults because they may have more savings, may be more trusting of official-seeming communications, and may be more isolated. The FTC reports a 4x increase since 2020 in older adults losing $10,000+ to impersonation scams.
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