Ever fantasized about what you would do if you became rich overnight? Lottery, sweepstakes, and inheritance scammers know that, and they prey on people’s desires to get something for nothing.
Lottery scam simplified
You may receive a call saying you’ve won some sort of a prize, be it money, a new car, or an appliance from a sweepstake or lottery you’ve never entered. Alternatively, someone may contact you and say that you’ve received an inheritance from a long-lost relative. However, you’ll know that it’s a scam if they ask you for your bank account information or to pay them to receive your prize.
Lottery scams are often carried out via mail, email, phone, or SMS.
Types of lottery scams
Lottery and Sweepstake scam
Lottery and sweepstake scams are when a scammer informs a potential victim of a "win" for a lottery or competition that the victim never entered. The person is then asked to pay "taxes," "shipping and handling charges," or “processing fees” to get their prize. The prize never appears, but the victim is convinced to pay an ever-increasing amount of "fees" and "taxes". The victim becomes emotionally invested in the process and continues sending money in hopes of getting the prize.
Inheritance scam is when a scammer offers a false promise of an inheritance. The scammer pretends to be a lawyer, banker, or other foreign official, and claims that the deceased left no other beneficiaries. A scammer tells that the “inheritance” is difficult to access due to government regulations, taxes, or bank restrictions, and that a victim needs to pay money and provide personal details to claim it.
Tips to prevent prize scam
Ask about the full terms and conditions regarding your alleged winnings. If the person sounds sketchy or keeps avoiding your questions, there’s likely something going on.
If it sounds too good to be true, then it probably is. Remember that you can’t win a lottery you didn’t enter and no one hands out free stuff for no reason.
Be financially responsible
Don’t transfer money over empty promises. Always remember that no lottery or sweepstake will EVER ask you for money to receive a prize.
Prize scam stats
According to the FBI Internet Crime Reports, here's how devastating lottery, sweepstakes or inheritance scams were from 2015 to 2022:
Average losses and victim count
year over year
Lottery, sweepstakes or inheritance fraud cases have reached record numbers with 8.5K yearly victims (around 23 victims per day) in 2020.
Victims have reported the highest average financial loss to lottery, sweepstakes or inheritance scams in 2022 ($14.8K per victim).
During the 2020 COVID-19 pandemic, the number of prize scam cases grew by 9%, and the average financial loss grew by 15% (from $6.3K to $7.2K) per victim compared to 2019 as well.
Despite the increasing awareness of online crimes, daily financial losses to lottery, sweepstakes or inheritance scams have grown around four times from 2015 ($53.1K per day) to 2022 ($229K per day).