Elder Scams: Sweepstakes and Lottery Scams Can Bankrupt Your Estate
By: Barry E. Haimo, Esq.
March 19, 2015
As the saying goes, “If it seems too good to be true, it probably is.”
While this time-honored adage rings true in many different situations, it is particularly relevant when applied to sweepstakes and lottery scams. These types of scams usually involve an email, phone call, or text message from a foreign lottery or sweepstakes company, alerting the recipient that they’ve won money or prizes in a competition they never entered.
Oftentimes, these messages will urge recipients to act quickly to avoid missing out on their prize, and ask them to pay a fee to access the winnings. Scammers often claim these upfront costs are necessary for covering insurance costs, bank fees, courier charges, or government taxes.
You may be able to guess what happens next. The scammers collect these “fees” before running off, and victims never receive their promised prize or a dime of their alleged winnings. In some cases, scammers ask victims to provide bank account information so the prize money can be transferred to them, or personal details to verify their identity. Scammers then use this information to steal their identity and access bank accounts. Many people have lost large portions of their estate to scams like these.
Marybeth Ford was one such victim to this kind of scam. She learned the hard way that not everybody online can be trusted.
Betrayed by a Trusting Nature
Mrs. Ford was happily retired, living comfortably in a modest St. Petersburg home with her two beloved poodles, Porky and Mindy. Her children had moved out of state long ago, but still found the time to visit her every Christmas and call her on Sundays.
Marybeth tried to be very responsible with her estate, budgeting a monthly allowance for rent, utilities, food, and a few treats. She was never one for extravagances, but she did enjoy going to the matinee with her friends on the weekends and buying colorful sweaters for Porky and Mindy. Marybeth was also setting aside money to visit California next fall to see her eldest daughter, who had just had a baby.
So it came as an unexpected but welcomed surprise when Marybeth received an exciting call from a lottery company in Jamaica. She had been expecting to hear from one of her daughters, so it was a bit of a shock to hear a male voice on the end of the phone when she picked up. She glanced at the area code—876? What kind of area code was that?
The man told her he was a representative from a lottery called Winner’s International, and he was pleased to inform her that she had won $500,000, plus a brand new BMW with 10 years of insurance!
“There must be some mistake,” Marybeth sputtered. “I didn’t enter any lottery!”
The man went on to assure her that her phone number had been selected randomly by the lottery’s system. He explained that she had to act within the next 24 hours if she wanted to claim her prize, and wire $5,999 via Western Union to cover the processing fee and the cost of shipping her new car. Once they received the money, they could deliver her check and ship out her car first thing in the morning.
“Well,” Marybeth admitted reluctantly. “I don’t have that kind of cash on hand!”
“Are you an American senior citizen, miss?” the man asked. “Well, in that case, we can give you a senior citizen’s discount. We can process the fee for as little as $3,500!”
Marybeth hesitated. $3,500 was more than three times her entire monthly budget, but the man did promise she’d receive her $500,000 prize within the week. With that kind of money, she could visit her daughter immediately, buy all kinds of presents for her new granddaughter, and her estate would be able to leave her children a significant inheritance when she finally passed!
“Alright,” she agreed. “Tell me who to wire the money to!”
As you may have already guessed, Marybeth never received her prize money or car after wiring over the $3,500. She waited a week before growing suspicious and contacting the authorities. They informed her that they were sorry, but she had most likely fallen victim to a Jamaican lottery fraud, an increasingly common type of scam that frequently targets the elderly and vulnerable. Marybeth was lucky, they informed her—$3,500 was only a tiny fraction of what these types of lottery scams typically haul in.
Marybeth was disappointed, but thankful that she hadn’t squandered any more of the hard earned money in her estate. With a little scrimping and saving, she could still afford to visit her new granddaughter in the fall, and with a bit more caution, she could avoid scams like this in the future.
Don’t Fall Victim to Sweepstakes and Lottery Scams
Marybeth was only one of many Americans who fall victim to sweepstakes and lottery scams each year. Avoiding these types of scams is only one of the reasons it’s so important have an effective estate plan in place. Estate planning can make it difficult for scammers, because of the various checks and balances that come with planning ahead. Estate planning attorneys can be invaluable allies when it comes to trying to protect your finances from scam artists and theft, since they are intimately familiar with safeguarding techniques and can quickly recognize signs when something’s amiss.
An experienced estate planning lawyer would have spotted the scam immediately, and advised Marybeth with the following key takeaways:
- Never trust a phone call, letter, email, or text that claims you have won a prize in a contest you haven’t entered yourself.
- Legitimate lotteries would never require you to pay a fee to receive your winnings.
- Official lottery offices do not select prize winners by randomly selecting phone numbers or email addresses.
- If it seems too good to be true, it probably is!
If you’re nervous about you or one of your relatives falling prey to a scam like this, there are a number of things that you can do to protect your money so that it’s more difficult to access in large quantities, but still provides for your regular living expenses. Ask an estate planning lawyer what kind of options you have available to you.
Barry E. Haimo, Esq.
Strategic Planning With Purpose
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