MEDIUM RISK
Lottery / Sweepstakes Scam
Fake notifications claiming you've won a lottery, sweepstakes, or prize — but must pay fees or taxes before receiving your "winnings."
Losses: $301 million (FTC 2024)
Targets: Elderly adults, hopeful individuals
Updated: 2026-01-06
Also known as: Prize Scam • Sweepstakes Scam • Foreign Lottery Scam • PCH Scam
1How It Works
You receive notification that you've won a prize you never entered to win:
**The setup:**
"Congratulations! You've won $1,000,000 in the International Lottery!"
"You've been selected for a $50,000 Publishers Clearing House prize!"
**The catch:**
To claim your "winnings," you must pay:
- Processing fees
- Taxes (in advance)
- Insurance
- Shipping costs
**The cycle:**
After each payment, there's another fee. The prize never comes because it doesn't exist.
**Why people pay:**
- Dreams of financial freedom
- Small fees seem worth it for big prize
- Official-looking documents
- Scammers are persistent and persuasive
How Scammers Make Contact
Phone callsEmailMailSocial media
2Warning Signs & Red Flags
- You "won" a lottery or contest you never entered
- Must pay fees, taxes, or shipping to claim prize
- Notification comes from foreign country
- Pressure to act quickly before prize expires
- Asked to keep winnings secret
- Payment requested via wire, gift cards, or crypto
- You receive a check but must return part of it
- Can't verify the company through research
3Real-World Example
"I got a call saying I won $2.5 million from Publishers Clearing House. I just needed to pay $500 in processing fees. I did. Then they needed $1,000 for insurance, then $5,000 for taxes. Over 6 months, I sent $35,000. The prize never came. My whole retirement savings — gone."
— AARP Fraud Watch Network
4How to Protect Yourself
- You can't win a contest you didn't enter
- Legitimate lotteries don't require upfront payment
- Taxes are withheld from winnings, not paid in advance
- Never pay via wire transfer or gift cards
- Playing foreign lotteries is illegal for US residents
- Research any company claiming you won
- Publishers Clearing House never charges fees or calls to ask for payment
5What To Do If You're a Victim
- 1Stop all contact and payments immediately
- 2Don't deposit any checks sent as "winnings"
- 3Report to FTC at ReportFraud.ftc.gov
- 4Report to your state attorney general
- 5If you sent wire transfers, contact the transfer company
- 6If you gave personal info, monitor your credit
Report This Scam
?Frequently Asked Questions
What is Lottery / Sweepstakes Scam?
Fake notifications claiming you've won a lottery, sweepstakes, or prize — but must pay fees or taxes before receiving your "winnings." You receive notification that you've won a prize you never entered to win:
**The setup:**
"Congratulations! You've won $1,000,000 in the International Lottery!"
"You've been selected for a $50,000 Publishers Clearing House prize!"
**The catch:**
To claim your "winnings," you must pay:
- Processing...
How common is this type of scam?
Lottery / Sweepstakes Scam is classified as a medium risk threat. Reported losses: $301 million (FTC 2024). This primarily targets Elderly adults, hopeful individuals.
Can I get my money back?
Recovery depends on how you paid. Credit card payments may be reversed through chargebacks. Wire transfers and cryptocurrency are rarely recoverable. Report immediately to your bank and file complaints with the FTC at reportfraud.ftc.gov and FBI IC3 at ic3.gov.
How do I report this?
Report to the FTC at reportfraud.ftc.gov. For internet crimes, file with FBI IC3 at ic3.gov. For identity theft, visit identitytheft.gov. Also contact your local police and your bank.
Sources & References
Related Scams
Government Impersonation Scam
Scammers pose as IRS, Social Security Administration, Medicare, or law enforcement to demand immediate payment or personal information.
Inheritance / Nigerian Prince Scam
Emails claiming you've inherited money from an unknown relative or foreign dignitary, requiring fees to release the funds.
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