Scam Busters: Phony Sweepstakes

The very mention of the Publishers Clearing House Prize Patrol and all the goodies they send is enough to put many in a swoon with visions of Ed McMahon knocking on the door with a big fat check.

But not all checks sent your way, even those which appear to be endorsed by Publishers Clearing House at first glance, are going to make you rich. Some are scams that will take you for thousands of dollars.

This past March, fake award letters designed to appear as if they are sent from Publishers Clearing House were found in mailboxes across 20 states, according to the Council of Better Business Bureaus.

The scam artists did their homework, too. According to Better Business Bureau spokeswoman Allison Southwick, the checks are so convincing that the victims often have no idea that they have been duped until they deposit them into their accounts. By then it may be too late.

How the Scam Works
An unsuspecting person receives an official-looking letter in their mailbox claiming that they have won a sweepstakes prize, say for a million dollars. The victim also receives a check for as much as $5,900, with instructions to deposit the money.

According to Southwick, the victim is told that they must cash the check and wire as much as $4,000 back to cover taxes and administrative fees before the full prize money can be awarded. Even though the check is bogus, it often will take a few days for it to bounce. In the meantime, the scammed "winner" is wiring back the fee payment from their actual bank account monies.

Once that transfer is complete, the victim is left with nothing except a broken promise, a check that is about to bounce, potentially crushing overdraft fees and a wire-transfer form for, say $4,000, which they will probably never see again.