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New Scam Alert Program Available

AARP Montana has joined with Attorney General Steve Bullock’s office to launch a new service to warn Montanans of emerging scams targeting the state. As Department of Justice officials investigate and track the latest scams, schemes and fraud aimed at Montanans, the new scam alert system is designed to warn residents of these emerging threats so they have the knowledge to outsmart scammers.

Montanans who would like to receive warnings of new scams can sign up for scam alerts. Subscribers will receive an immediate welcome e-mail and then be notified of the latest scams and fraud schemes moving into Montana.

The first scam Bullock announced through the new system is called the “grandparent scam,” which targets older Montanans.

The Grandparent Scam – A cruel swindle targeting older Montanans

In the grandparent scam, an older person receives a call from someone who pretends to be his or her grandchild. Sometimes, the caller is crying, sounds distressed, and may claim to be in a foreign country. Despite differences in the details, the call always leads to one thing: the grandparent must wire cash to help his or her grandchild. While the entire scenario is fiction – the person's actual grandchild is not in trouble – once a trusting grandparent wires money overseas, it is virtually impossible to recover.

"Montana seniors have lost tens of thousands of dollars to criminals who make their living preying on decent people's emotions," Bullock said. "We're alerting Montanans about this scam because we don't want more trusting individuals to fall victim to this cruel hoax.”

Montana's Office of Consumer Protection, which Bullock oversees, reports that con artists have used the grandparent scam to bilk seniors out of more than $68,000 this year alone. Those figures reflect only those people who reported the scam to the Montana Department of Justice – the true cost of the scheme is certainly much higher, Bullock said.

“Scammers are banking on the hope that their victims haven’t been forewarned,” Bullock said. “The Scam Alert system puts the information our investigators and attorneys uncover into the hands of Montanans. It can be very difficult, if not impossible, to recover monies swindled away in a scam. But a vigilant public can shut down scammers before they strike.”

"Congratulations, you've won!"

Those are words we would all love to hear. Who doesn't dream of winning big? But for a growing number of Montanans, those words are the beginning of a nightmare. Because officials have seen a resurgence of prize and lottery scams in the state, Attorney General Steve Bullock has issued a scam alert to warn Montanans about this fraudulent activity. Since 2008, reports of fake lottery and sweepstake scams in Montana have ballooned, nearly tripling. Along the way, they have tripped up dozens of unlucky Montanans, some of whom have lost tens of thousands of dollars.

Sweepstakes and lottery scams are not new, but they are definitely on the rise, particularly as the nation's economic climate has worsened. On average, someone calls the Consumer Protection Office once a day complaining of a lottery or sweepstakes scam. Additionally, the Better Business Bureau, police departments, banks and Montana Lottery officials report that that they, too, receive many calls about such scams.

The schemes differ on specifics, but most follow a formula:

  • A person receives an unsolicited letter, e-mail or phone call from an organization claiming to be a legitimate lottery in a foreign country, a private sweepstakes firm or a lottery "commission." They all bear the same message: You're a winner!
  • To redeem his or her "winnings," a person must first send or wire money to lottery or sweepstakes officials. The scammers often request that the money be wired because money sent in this way is much harder to trace.
  • Sometimes, these fees are explained as taxes or administrative fees that must be paid up front.

In other variations, the scammers promise the "winner" tens of thousands of dollars and send along a check for a smaller amount intended to cover "legal fees" associated with winning. This check is to be deposited immediately and the winner is instructed to send the money to a "lawyer" who will help them process and collect the winnings.

These checks often look very realistic; many are fakes copied word-for-word from real businesses. And while these checks will always bounce, the money a "winner" wires away is all too real – and in almost every case, that money is gone for good. (See an example of one of these fake checks.)

How can you tell if you're being hit by a scam? Here is how a legitimate lottery works, according to the Montana Lottery:

  • An actual lottery does not contact the winner; they don't even know who the winner is. A real lottery knows only the winning numbers on a ticket and where the ticket was sold. The winner must keep the ticket and confirm the numbers with lottery officials. If you are contacted by someone claiming you have won a lottery, it is a scam.
  • In a real lottery, winners pay for nothing other than their ticket. All federal and state taxes are paid before the Montana Lottery releases money to the winner. A winner is never asked to pay such taxes out-of-pocket before receiving his or her prize.
  • Lotteries of foreign countries are illegal in the United States. No legitimate foreign lottery sells tickets in the United States. If you have been contacted by a lottery claiming to be affiliated with the government of another country, it is a scam.

How can you avoid Sweepstakes and Lottery Scams? Follow these tips to avoid falling victim to a lottery or prize scam:

  • Look for clues in the "award" letter. Are there unusual misspellings, grammatical errors? Rest assured that any organization that has $180,000 to give away also has a proof-reader with an excellent command of the English language.
  • Look at the check. Because these checks are typically forged copies from real businesses, the business address and name on the check will be different from the name of the organization that claims to be handing out cash.
  • Ask yourself: Did I enter a sweepstakes or buy a lottery ticket? If you did not, then you could not have won.
  • Does the organization ask you to cash your check "right away"? High-pressure pitches are common in such scams. These criminals are hoping people will act before they think.
  • Never wire money to someone you don't know, especially to a foreign location.
  • Authentic sweepstakes require the winner to sign an affidavit assuring their identity on any prize valued at more than $600.

“The fight against fraud never stops,” said AARP Montana State Director Bob Bartholomew. “Each year, con artists discover new ways to cheat people out of their hard-earned savings, often just by repackaging the old tried-and-true scams. Education and awareness are a consumer’s best defense against scams, schemes and fraud – this is why I encourage folks to sign up for this new scam alert system.”

To receive warnings of emerging scams, schemes and fraud targeting the state, sign up for the Attorney General’s new scam alert system.

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