Everyone loves the idea of winning the lottery, hitting it rich, and living the life of luxury. We are all familiar with the Publishers Clearing House Sweepstakes, and wait for delivery of the big check with balloons and flowers. However, scam artists are continually coming up with new ways to prey on our fantasies, and the Federal Trade Commission (“FTC”) has issued new warnings about prize scams which are making the rounds.

According to the FTC, an 82-year-old Livonia woman filled out an entry to Publishers Clearing House and made a small purchase as part of her entry, using her credit card. She later received a number of calls from a man posing as a Publishers Clearing House representative, who claimed that she had won the sweepstakes. He then asked her for personal information, such as her credit card account information. Although this woman was smart and did not give out any information, and instead reported the phone calls to the police, she nonetheless was the victim of identity theft and had more than $7,000.00 in unauthorized credit card charges.

Similarly, a senior in the Cleveland area was also told that she had won millions from the Publishers Clearing House sweepstakes. Sadly, she ended up being scammed out of $45,000.00, when she was told that she would have to pay taxes up front to claim her prize. A California woman was told that she had won a car, but had to pay a $399.99 delivery fee. She sent a cashier’s check as requested, but no car ever arrived.

Scams like this occur every day around the country. Publishers Clearing House has indicated that they are working diligently with law enforcement officials to try to stop these scams, but reiterated that “no purchase, tax, payment, fee or money transfer is ever requested or required to collect a prize” from Publishers Clearing House. This is a good rule of thumb if you are contacted by any entity claiming that you have won big. If they are asking for funds up front, it is probably a scam.

The Better Business Bureaus of Eastern Michigan and the Upper Peninsula have warned that some con artists include what looks like a legitimate check in the “winning” letter, supposedly to cover taxes on the winnings. This is a twist on the scam. If you deposit the check and send in the “tax” money to claim your prize, you will end up owing the bank when the fake check fails to clear the bank.

Here are a few tips to avoid being scammed:

  • Never pay money upfront to claim a prize or cover so-called taxes. If you are being asked to load money on a prepaid card or wire money, it is a scam.
  • No one will send you an email or a note on Facebook to inform you that you have won money.
  • You cannot win a contest that you have never entered.
  • Never give out personal information, such as a credit card number or social security number, in order to verify that you have won a prize.
  • If you are unsure if you really have won, ask a friend, relative, or your attorney to review any letters or emails that you have received to determine if it is a scam.