Missouri Man Loses $41,000 In Sweepstakes Scam; BBB Warns Against Paying 'Prize Fees'

November 03, 2012
A custodian from Jefferson County, Mo., said he is devastated after losing his life’s savings of more than $41,000 in a sweepstakes scam that unfolded over several months earlier this year.

The man told the Better Business Bureau (BBB) that the thief phoned him in March and told him that he had won $8.5 million in cash, a BMW automobile and a home in Miami. The scammer then instructed him to use prepaid Green Dot MoneyPak cards and Western Union wire transfers to pay taxes and other fees associated with the sweepstakes. The man said he made 46 different payments by MoneyPak or Western Union through several different businesses in the St. Louis area, sending money to a caller he knew only as “Mr. Scott.” He never received anything in return.

None of the clerks at the stores where he made the payments warned that he might be the victim of a scam. He didn’t notice the fraud warnings on the MoneyPak cards or Western Union paperwork until it was too late.

The custodian said he believed the thief, in part, because the emailed prize notification from “Readers Dijest” contained what appeared to be an official seal of the U.S. Department of Homeland Security. The caller said  the sweepstakes was affiliated with both the Department of Homeland Security and the BBB.  “I didn’t realize it was that easy to scam somebody,” he said.

This fraud is similar to other scams that have claimed victims across the nation, though the amount lost in this case is unusually large.
These cases are truly heartbreaking, especially when people end up spending tens of thousands of dollars in advance fees for a sweepstakes that never existed.  Never ever pay money to anyone who promises that you have won a lottery or sweepstakes. And never use Green Dot Moneypaks or Western Union to send money to someone you don’t know.

The Jefferson County victim said he became increasingly skeptical about the sweepstakes after numerous delays. He continued making payments, however, after repeated assurances that he was on the brink of collecting his winnings. In addition to the Moneypak and Western Union payments, he also wrote two checks totaling $10,000 to a man in Alabama. As the delays continued, he said, he became frustrated and finally began to believe he was being duped.

He said the scammer ultimately told him that a representative assigned to deliver the money and the automobile fled with his winnings, but the thief was apprehended by the FBI. He was then told he would have to pay additional fees. At that point, he said, he refused to send any more money and contacted the BBB, which told him he had been the victim of a scam.

The man said that while he takes ultimate responsibility for his actions, he believes an astute store clerk or representative at the banking facility where he purchased the Western Union transfers could have saved him money and heartache. He said he was never warned of the potential pitfalls of using the cards or wire transfer services. Two of the Western Union payments went to Jamaica, a country that has become notorious for Internet and phone scams.

The victim also was critical of the scam warning printed on the Green Dot Moneypak cards. The information on the cards was unclear, and the type too small to read easily, he said.

The BBB offers the following advice to people who have been notified that they have won a sweepstakes or lottery:

  • Remember that nearly all of these notifications are fraudulent. 
  • Never send any payment to anyone as a requirement for receiving your prize. Any such request means that the prize notification is bogus.
  • Never send a wire transfer or give the access number to a prepaid money card to anyone you do not know, or anyone you suspect might be trying to steal your money. Wire transfers and prepaid cards are like cash and can’t be recovered.
  • If you have any questions about a sweepstakes or lottery notification, check with the BBB at www.bbb.org.