Lottery Win Scams

We continue to receive reports of letters and emails being distributed about prize sweepstakes or lottery schemes. These schemes use counterfeit checks that bear legitimate-looking logos of various financial institutions to fool you into sending money to the fraudsters.

Fraudsters tell you that you have won a sweepstake or lottery, but to receive a lump sum payout, you must pay the taxes and processing fees upfront.

Fraudsters direct you to call a telephone number to initiate a letter of instruction. The letter alleges that you can elect to take an advance on the winnings to make the required upfront payment. The letter includes a check in the amount of the alleged taxes and fees, along with processing instructions.

Ultimately, you are designed to believe you are using the advance to make the required upfront payment, but in reality you are falling prey to the scheme.

You then deposit the check into your own bank, which credits the account for the amount of the check before the check clears. You then immediately withdraw the money and wire it to the fraudsters.

Afterwards, the check proves to be counterfeit and the bank pulls the respective funds from your account, leaving you liable for the amount of the counterfeit check plus any additional fees the bank may charge.

People may fall victim to this scheme due to the attraction of easy money and the apparent legitimacy of the check the fraudsters include in the letter of instruction. The alleged cash prizes and locations of the financial institutions vary.

Tips to avoid being scammed:

• A federal statute prohibits mailing lottery tickets, advertisements, or payments to purchase tickets in a foreign lottery

• Be wary if you do not remember entering a lottery or sweepstakes

• Beware of lotteries or sweepstakes that charge a fee prior to delivering your prize

• Be wary of demands to send additional money as a requirement to be eligible for future winnings


Shopping Scams

With Christmas coming, it is a timely opportunity to remember some of the more common shopping scams.

Fraudulent Classified Ads and Auction Sales

Internet criminals post classified ads and auctions for products they do not have, and make the scam work by using stolen credit cards. Scammers receive an order from a victim, charge the victim's credit card for the amount of the order, then use a separate, stolen credit card for the actual purchase.

They pocket the purchase price obtained from the victim's credit card and have the merchant ship the item directly to the victim.

Consequently, an item purchased from an online auction but received directly from the merchant is a strong indication of fraud. Victims of such a scam not only lose the money paid to the scammer, but may be liable for receiving stolen goods.

So when shopping, avoid these scams by using caution and not providing financial information directly to the seller, as fraudulent sellers will use this information to purchase items for their schemes. Always use a legitimate payment service to ensure a safe, legitimate purchase.

As for product delivery, scammers posing as legitimate delivery services offer reduced or free shipping to customers through auction sites. They perpetuate this scam by providing fake shipping labels to the victim.

The scammers do not pay for delivery of the packages; therefore, delivery service providers intercept the packages for nonpayment and the victim loses the money paid for the purchase of the product.

It is important to check each seller's rating and feedback along with their number of sales and the dates on which feedback was posted. Be wary of a seller with 100% positive feedback, with a low total number of feedback postings, or with all feedback posted around the same date and time.

Gift Card Scam

Be careful when purchasing gift cards through auction sites or classified ads. It is safest to purchase gift cards directly from the merchant or retail store. If the gift card merchant discovers that your card is fraudulent, the merchant will deactivate the gift card and refuse to honor it for purchases. Victims of this scam lose the money paid for the gift card purchase.

Phishing and Smishing Schemes

In phishing schemes, a scammer poses as a legitimate entity and uses emails and scam web sites to obtain your personal information, such as account numbers, user names, passwords, etc. Smishing is the act of sending fraudulent text messages to bait a victim into revealing personal information.

Be wary of emails or text messages that indicate a problem or question regarding your financial accounts. In this scam, the scammers direct you to follow a link or call a number to update an account or correct a supposed problem. The link directs you to a fraudulent web site or message that appears legitimate. Instead, the site allows the scammer to steal any personal information you provide.

Current smishing schemes involve scammers calling your cell phone offering to lower the interest rates for credit cards you do not even possess. If you say that you do not own the credit card, the caller hangs up. These scammers call from TRAC cell phones that do not have voicemail, or the phone provides a constant busy signal when called, rendering these calls virtually untraceable.

Phishing schemes related to deliveries are also common. Legitimate delivery service providers neither email shippers regarding scheduled deliveries nor state when a package is intercepted or being temporarily held. Consequently, emails informing of such delivery issues are phishing scams that can lead to personal information breaches and financial losses.


Here are some tips you can use to avoid becoming a victim of cyber fraud:

• Do not respond to unsolicited (spam) email

• Do not click on links contained within an unsolicited email

• Be cautious of email claiming to contain pictures in attached files, as the files may contain viruses. Only open attachments from known senders. Scan the attachments for viruses if possible

• Avoid filling out forms contained in email messages that ask for personal information.

• Always compare the link in the email with the link to which you are directed and determine if they match and will lead you to a legitimate site

• Log directly onto the official web site for the business identified in the email, instead of "linking" to it from an unsolicited email. If the email appears to be from your bank, credit card issuer, or other company you deal with frequently, your statements or official correspondence from the business will provide the proper contact information

• Contact the actual business that supposedly sent the email to verify if the email is genuine

• If you are asked to act quickly, or there is an emergency, it may be a scam. Scammers create a sense of urgency to get you to act quickly

• Verify any requests for personal information from any business or financial institution by contacting them using the main contact information

• Remember if it looks too good to be true, it probably is  


Rental Property Scam

We have received some complaints that there is a recent increase in online classified ads for residential and holiday rental properties that are scams.

Scammers will quote extremely low prices to get your attention. If you show interest, you will receive a lengthy email detailing why you cannot inspect the property in person, typically because the owner is out of the country.

This scam often uses a fake copy of a genuine property advertisement to fool you. The scammer may also try to gain your trust with false but convincing copies of lease and ID documents and elaborate stories, sometimes claiming that they are carrying out humanitarian work overseas for a charity.

They will typically try to trick you into giving them an upfront fee, and if you are looking for a holiday rental, may request another electronic transfer when you enter the country. The scammer’s correspondence may be poorly written and will ask for your personal information, sometimes disguised as a rental application.

Beware as the scammers create elaborate stories to try and trick you into paying upfront, before you have the chance to work out that it’s a scam. NEVER provide your personal details via email - scammers will use them to steal your money or commit identity fraud.

If you send money to these scams, legitimate keys to the property will not be provided in return, and your money will be gone - along with the ‘owner’.

Protect Yourself

For residential rentals insist on inspecting the property - a drive-by is not enough. The property may genuinely exist, but it is owned by someone else.

If you are overseas looking for a holiday rental, ask someone you can trust to make inquiries. A real estate agent in the area may be able to assist.

Search online for the address of the property, the name of the person offering the property and their email address - many scams can be identified this way. Where possible, avoid paying via money transfer. It is rare to recover money sent this way. Consider using a reputable accommodation website that offers added protection.

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