Over the years, I have written many times about lottery and sweepstakes scams, which continue to be one of the most popular and profitable scams for scammers. Scammers use lottery and sweepstakes scams to cheat people out of millions of dollars each year by tricking their victims into sending money to the scammers after convincing their victims that they have won a lottery, but are required to pay some fees or taxes in order to collect their prize. It is hard to win any lottery. It is impossible to win one that you have not even entered and yet scam artists, the only criminals we refer to as artists have found that it is extremely lucrative to scam people by convincing them that they have won various lotteries.
Most lottery scams involve the victims being told that they need to pay taxes or administrative fees directly to the lottery sponsor; however no legitimate lottery requires you to do so. As with many effective scams, the pitch of the scammer seems legitimate. Income taxes are due on lottery winnings, but with legitimate lotteries they are either deducted from the lottery winnings before you receive your prize or you are responsible for paying the taxes directly to the IRS. No legitimate lottery collects taxes on behalf of the IRS from lottery winners. Other times, the scammer tell the “winners” that in order to collect their prizes, they need to pay administrative fees. Often, the victims are told to send the fees back to the scammer by prepaid gift cards or prepaid cards. Prepaid cards are a favorite of scammers because they are the equivalent of sending cash. They are impossible to stop or trace. Again, no legitimate lottery requires you to pay administrative fees in order to claim your prize.
In 2019 I told you that the Federal Trade Commission (FTC) and the Attorney General of Missouri settled charges of sweepstakes fraud it brought against Kevin Brandes, William Graham and their shell corporations regarding deceptive mailers they sent to their mostly elderly victims around the world with headings such as “Congratulations, You Have Just Won $1,230.946.00” Other mailers invited the victims to play “games of skill” without clearly disclosing the fees that they had to pay. The final round of the game consisted of a tremendously complex mathematical puzzle that was pretty much unsolvable. Many victims of the scam paid time and time again to play games that were rigged against them. The defendants turned over more than 24 million dollars in cash and personal property that was sold to raise further funds to be used to make refunds to victims of the scam. Now the FTC is using those funds to reimburse victims of the scam. The FTC is making payments through PayPal and by checks. Checks must be deposited and PayPal payments must be claimed no later than October 17, 2022.
As I have often told you, it is difficult to win a lottery you have entered. It is impossible to win one that you have not even entered. You should always be skeptical about being told that you have won a lottery you never entered. It is also important to remember that it is illegal to play foreign lotteries except when you are actually present in the other country.
While it is true that income taxes are owed on lottery winnings, legitimate lotteries never collect tax money from winners. They either deduct the taxes from the winnings or leave it up to the winners to pay their taxes directly to the IRS. You also should never pay a fee to collect a legal lottery prize.
Finally, in regard to the refunds being made, there is never a fee or charge to receive these payments. Anyone claiming you owe a fee to collect your refund is a scammer.
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