Scam of the day – March 18, 2013 – Jamaican Lottery Scam update

Lottery scams are one of the most popular scams for scam artists because they work so effectively.  They start when you receive a telephone call telling you that you have won some lottery, usually based in a foreign country.  Soon thereafter, however you are told that you need to pay either taxes or administrative fees.  The victims of this scam end up paying thousands of dollars in phony fees and taxes, but never receive a dime of lottery winnings.  The island of Jamaica has become a hotbed of this type of scam with daily calls to the United States totaling more than 30,000 and as much as 300 million dollars stolen  last year alone from unwary victims, many of them senior citizens.  The problem has gotten so bad that the U. S. Senate Special Committee on Aging had hearings last week about how to stop this scam.  The Jamaican government has recently passed new laws with the intention of cracking down on this scam, but with government officials in the past having been actually a part of this scam, it remains to be seen as to the extent of the Jamaican government’s commitment to stopping this scam.

TIPS
It is hard to win a lottery you have entered.  It is impossible to win one that you have never even entered.  A little skepticism can save you a lot of money when you are told that you have won such a lottery.  It is also important to note that it is illegal to play foreign lotteries.  If you receive a telephone call from the 876 area code, the area code for Jamaica, you may wish to not even answer the phone unless you have family vacationing in Jamaica, because there is a good chance that if you have no connection to Jamaica, the person on the other end of the line is a scam artist.  In regard to income taxes on lottery winnings, they indeed are subject to income tax, but either the lottery sponsor deducts taxes from your winnings or leave it to the winners to pay their own taxes.  They never collect taxes.  Legitimate lotteries also do not charge you administrative fees before you can claim your prize.  If you are told that you must pay money, under whatever guise they use before you can claim your winnings, the lottery is a scam.