SCAMS

The famous bank robber, Willie Sutton, is credited with once saying that he robbed banks because “That’s where the money is.”

For much the same reason, lotteries attract a sizable number of con artists and criminals. In order to protect yourself and your money, it pays to be knowledgeable about how common lottery scams work and how to avoid becoming a victim.

Phishing

What exactly is "phishing"? Phishing is a crime in which thieves trick people into sharing sensitive personal information like passwords and credit card numbers. The victims of phishing might receive malicious emails or text messages that designed to imitate them into sharing information. Alternavitly, the thieves may masquarade as a person or organization the victim trusts, like a coworker, a bank, or a government office or in our case official lottery personnel. When the victim opens up the text message or the email, they find a message that demands they go to a website and take immediate action or risk some sort of consequence. If they take the bait and click the link, the victim is sent to an imitation of a legitimate website. Once they arrive, the victim is asked to log in with their username and password credentials. This information then goes to criminals who steal identities, pilfer bank accounts, and sell personal information on the black market. So be alert and careful when you use your personal information!

Target: People who didn’t even play the lottery.

How it Works:
Criminals begin by sending a message out to thousands of people like the one above.
Key elements of the message are:
The message is unsolicited
The message claims to be from a well known and reputable organization
The message promises money for a contest the victim did not enter
The message begins “coaching” or “grooming” the victim to:

• Contact a representative quickly
• Share information with the representative
• Keep the winning confidential

The message encourages quick action

These themes are designed to trigger a recipient of the message to become excited and act thoughtlessly.
The second phase of the scam begins when a message recipient contacts the criminals.The criminals will continue the themes listed above to keep the victim excited and reckless. But they will also add a new element to the situation: They ask for money. There are a number of different ways that they can justify this request. The criminal may claim that the money is for “taxes”, “processing fees”, “account set up”, or they may simply ask for your personal account details.
In the final phase of the scam, the victim transfers money and the criminals disappear. Or the criminals take the personal data that they have collected and steal money through identity theft. Either way, the victim is left abandoned and feeling like a fool.

How to Protect Yourself:
Keep in mind that:

1. No lottery commission contacts winners directly.
2. You can’t “win” a contest that you never entered.
3. No lottery collects advanced “fees” before transferring the prize.

The easiest way to protect yourself from this scam is simply to ignore the initial message.
If you ever find that you have been tricked into responding to a message and you are asked to provide money or personal information, STOP. Take no action. And if you really, really feel like you have to do something, contact the organization the message is supposed to come from and see what they have to say. No matter what, don’t be silent. Don’t keep the communication “confidential”. If the criminals have your information, they may have the contact information of your friends, family, or co-workers. Tell others about the scam and help protect them from becoming victims.

False testimonials:

Target: People who play the lottery and want an advantage

How it Works:
This scam is more like a dishonest sales pitch than a criminal trick.
In this situation, a con-artist offers to sell information that will “guarantee” a lottery win. But they don’t make the offer directly.
Instead, they create fake testimonials on social media. In the testimonial, the con-artist pretends to be a lottery winner who used the services of someone with mystical powers or mathematical genius. The false testimonial then encourages everyone to use these services to win big.
When people follow the contact information of the testimonial, they are led to a simple fee-for-service offer. The con-artist offers to provide guaranteed lottery numbers in exchange for a relatively small amount of money. In rare instances, the con-artist may attempt to steal personal data.

How to Protect Yourself:

No one can guarantee that you are going to win the lottery.
Certainly, no one can guarantee that you are going to win a specific lottery drawing with a specific set of numbers.
The best way to protect yourself from this type of scam is simply to ignore it.
You can protect others by refusing to forward such claims on social media and reporting it where possible.

Fake Social Media Accounts:

Target: People on social media

How it Works:
Every year there are a few people who win amazing sums of money in the lottery. Almost every one of these people make a public pledge to do good with their newfound wealth.
Con-artists combine this publicity with social media to try to build a following which they can later exploit. They create a social media handle with the name of a big lottery winner and begin sending messages asking people to follow them or retweet their messages. Often these requests come with an offer of money if targets can reach a certain number of retweets.
Two examples of lottery winners who experienced this misuse are Shane Missler and Robert Erb.

How to Protect Yourself:
As with false testimonials, the best approach you can take when dealing with fake social media accounts is simply to ignore their messages and report them if possible.

Petty Theft

Target: Lottery winners of small prizes

How it Works:
In this scam, the thief simply steals the ticket from a winner and claims the prize as his own.
One of the most popular variations on this scam is perpetrated by clerks working at convenience stores. Many lottery players will present their ticket for a clerk to check if it is a winner. That is, they physically hand the ticket to the clerk, the clerk scans the ticket at a counter-top kiosk, then the clerk reports whether the ticket is a winner or not.The reason that this situation is so ripe for theft is because the lottery player has relinquished physical control of their ticket without knowing if it is winner. This allows the clerk to falsely report that the ticket is not a winner even though it is. Once the disappointed lottery player leaves, the clerk simply pockets the prize money.
Lottery commissions have taken steps to counter this trick by making lottery scanning devices produce an audible chime when a winning ticket is scanned; however, this has not stopped clerks from stealing people’s prizes. In areas with this feature, clerks can still use a bit of sleight of hand to swap the player’s ticket with a different, losing ticket. For example, they might drop the ticket on the floor and pick up a different one.

How to Protect Yourself:
1. Oddly enough, the usual advice about signing your ticket and keeping it in a safe place are not enough in this situation. Instead, players have to be a bit more careful.
2. Check your own numbers using a public, official source.
3. Conduct your transactions with a trusted clerk.
4. Always get your ticket back from the clerk if it is not a winner.
5. None of these techniques will prevent thieves from preying on lottery winners, but they will go a long way to making sure that you are not a victim.

Ticket Tampering

Target: Bystanders

How it Works:
Like phishing scams, these criminals target innocent bystanders but instead of casting a wide net, they target random individuals.
The first step of a ticket tampering scam is that the criminals will manufacture a ticket that looks like a winning ticket. They might do this by modifying the numbers (for example, turning an 8 into a 6). However, since the victim is likely to pay close attention to the numbers, they are more likely to purchase a ticket with the winning number from a previous drawing and tamper with the date on the ticket.
The second step of this scam is to convince someone to “buy” the ticket from them. The key to doing so is to convince the victim that the holder of the ticket cannot claim the ticket themselves. A common justification is that the winner is not in the country legally and therefore is afraid to deal with the authorities. Another justification is that the criminal doesn’t want his wife to know that he won the money.
Once the criminal convinces the victim to engage in the transaction, they offer to split the prize. But here’s the catch: They want their money upfront. They will claim that they are afraid that the victim will just walk away with their prize.
Naturally, once the criminal has the cash, they will disappear and the victim will realize that the ticket is worth nothing.
Special Note: This scam has been perpetrated at all prize levels, from the trivial to the large. It works best when the amount of money in question is attractive, but not so large that it exceeds the victim’s ability to get the amount of cash the criminal asks for. Therefore, much of this scam activity is believed to occur in the $100 to $500 range.

How to Protect Yourself:
1. The best thing to do is simply walk away. Don’t engage or interact with the con-man.
2. If you find that someone is running this scam near a convenience store or other public place, notify the manager or the police.

Tax Evasion (Discounting)

Target: Medium to Large Prize Winners

How it Works:
While many of the other scams presented here are a version of con-artistry, this scam is more of white-collar crime. As a result, the perpetrator may not think of themselves as a “criminal” and instead think that they are a clever “advisor”.
The process is remarkably simple. Since lottery tickets are not registered to an owner, anyone can claim a ticket. A lottery winner stands to forfeit a substantial amount of their prize to taxes . Some criminals offer a service where they will purchase the winning ticket for a discounted amount that is more than the lottery winner would have received if they had paid taxes. The criminal then claims the prize as their own and handles the associated taxes themselves.
This is where the criminal act comes in. The criminal will either claim large gambling losses (often justified by losing tickets they bought in bulk) or simply never claim the winnings at all. Either way, this system constitutes tax evasion. What is worse, the original ticket holder can be charged with tax evasion because they didn’t pay taxes on the sale of their ticket.

How to Protect Yourself:
1. Strange as it may seem, you want to pay taxes. Paying taxes on your lottery winnings avoids long term hassles that no one is interested in.
2. It is reasonable to attempt to reduce your taxes, but the best way to do so is by talking to a certified financial advisor who can give you advice which can protect your money without putting you at risk.

Bogus Charities:

Target: Large prize winners

How it Works:
Lottery winners who receive large prizes can anticipate lots and lots of requests for money. One of the simplest scams is for criminals to simply pose as legitimate charities and request donations.
Just as phishing scams prey on a victim’s desire to win the lottery, bogus charities prey on a victim’s desire to do good. These criminals will use powerful emotional appeals paired with a sense of urgency and the con-man’s classic caution against telling others about the donation.
As with any scam, once the money goes into the criminal’s account, they are free to disappear. However, a charity scam can easily be continued by showing false evidence of the good that has been done and the need for more money.

How to Protect Yourself:
When you find yourself in the enviable situation of having a large lottery prize that attracts these types of criminals, build your own team of legal and financial advisors. Include a charitable donation plan in your strategy so that you will know that you have done good with your money. Having set an established limit on charitable giving and focused on the range of causes you care about will make it easier to say no to anyone who approaches you about their own efforts.