"Congratulations! You've won $50,000 in our international lottery!" If you've received a message like this, you've been targeted by one of the oldest and most persistent scam categories. In 2024, Americans lost over $500 million to prize scams (FTC).
How Lottery Scams Work
You receive notification of a prize you never entered to win. To claim it, you must pay "taxes," "processing fees," "insurance," or "customs" in advance. No prize materializes — only escalating fee demands.
The Tax Prepayment Lie
The most common justification for upfront payment is taxes. This is not how taxes work. Legitimate lottery prizes have taxes withheld automatically or reported to the IRS — winners never pay taxes in advance to a lottery organization. Taxes are paid to the government on your next tax return.
How to Know If It's Real
- You entered it. You cannot win a lottery you never entered.
- It's from your country. You cannot win foreign lotteries (Canadian lottery, Spanish lottery, etc.) without physically purchasing a ticket there.
- No upfront payment is required. Ever. For any reason.
- You can verify it. The organization has a verifiable, established presence you can independently research.
Legitimate Sweepstakes Rules
In the US, legitimate sweepstakes must: offer no purchase necessary, disclose odds, have a set prize structure, and are regulated by state laws. A sweepstakes that requires payment to claim a prize is illegal — and a scam.
What to Do
Don't pay anything. Don't provide personal information. Report to the FTC at reportfraud.ftc.gov and your state attorney general's office.
Sources: FTC; US Postal Inspection Service; Canadian Anti-Fraud Centre.