Can't Win for Losing
By: Source: AARP Bulletin Today Date Posted: 2004-12-10 13:33:00-05:00
Claire Wilson of Fremont Park, Calif., was elated when she got a call saying she had won $100,000 in a Canadian lottery. The timing was perfect. "My son-in-law was in the midst of having a liver transplant," says Wilson, 86. "I thought I could maybe help him out."
Her joy was short-lived. Not only did the $100,000 never materialize, Wilson was conned out of $8,000 in fees required before she could collect her "winnings."
Wilson, who asked that her real name be withheld, was duped in a scheme that claims thousands of victims each year. Using the prospect of instant wealth as bait, con artists posing as Canadian customs officials or lottery executives telephone their prey and convince them they’ve won big money in a lottery or sweepstakes. The catch: No prize money is released until the "winners" pay customs duties, taxes, or shipping and handling fees, usually to a Western Union office in Canada.
Swindlers can wreak even more damage if they can sell their victims on the convenience of automatically withdrawing the fees from their bank accounts. Once they have access, the con artists can deplete the account.
Law enforcement officials say the Canadian lottery hoax is robbing Americans of about $120 million a year, mostly in fees to dubious telemarketers but also in payments sent to con artists pushing lottery tickets via the mail.
Foreign lotteries or sweepstakes contests conducted by mail are illegal in the United States. Even so, U.S. postal officials last year destroyed 322,000 solicitations heading into this country, the bulk of which were from Canada, followed by Australia and Europe, says Robert DeMuro of the U.S. Postal Inspection Service. These are only a small percentage of all solicitations, he says. Many are disguised to cross the border without detection.
Phony Canadian lotteries are one of the top two telemarketing scams in the United States, says C. Steven Baker, director of the Federal Trade Commission’s Midwest region.
How do you spot a lottery hoax? "When someone tells you you’ve won a bunch of money and they want money from you in advance for anything, including a stamp, it’s illegal," Baker says. "Nobody ever gets any money; it doesn’t happen."
Yet interest runs high, judging by the 1,800 people who called local Better Business Bureaus last year to ask if certain foreign lotteries were legitimate. "Consumers find out later there is no way to get their money back," says Sheila Adkins, a spokeswoman for the Council of Better Business Bureaus.
Claire Wilson can attest to that. When she didn’t receive her promised lottery winnings after shelling out $8,000—borrowed on her credit card and from her granddaughter—she called the police. But it was too late. There was no trace of her money or the con artists who stole it.
"I was one of those people who got caught in this because it sounded so good," she says. "It’s made a nervous wreck out of me."
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