“OH MY GOD, MOM! YOU WON $2 MILLION!” I may or may not have screamed at my mother at some point in my youth, while brandishing an envelope with that very same claim emblazoned across it. But my mother didn’t join in celebration, because she like, everyone else who gets those letters, didn’t win a dime. The Federal Trade Commission has now sued to stop what it calls a massive sweepstakes scam responsible for bilking more than $11 million from people in the U.S. and around the world.
Luckily for my mom, she realized those letters were just personalized mass mailings, similar to those under fire from the FTC. The federal court has since stopped the defendant and his companies from sending out letters telling recipients they’ve won a large cash prize.
These letters often have bolded statements like “Over TWO MILLION DOLLARS in sweepstakes has been reserved for you.” In order to receive that money, consumers are told they have to send in a small fee of about $20 to $30, telling them they’re often “guaranteed” to get the prize money if they do so. But of course, it’s a limited-time offer, so you better hurry.
But it’s a whole other story on the back of the letter, claims the FTC, where the defendant uses “dense, confusing language” to issue statements that are the opposite of the claims of possible big winnings.
“A very careful reader might learn that they in fact have not won, and that the defendants do not sponsor sweepstakes but instead claim only to provide consumers with a list of available sweepstakes,” explains the FTC in a press release. “Consumers frequently fail to see or understand this language and send money to the defendants. The FTC alleges that this language does not appear designed to correct deceptive statements, but exists mainly as an attempt to provide a defense to law enforcement action. Consumers get nothing of value in exchange for their payment.”
The defendant has sent more than 3.7 million letters over the past two years and collected more than $11 million from consumers since 2009, many of which appear to be over 65.
The court order puts a temporary kibosh on the mailings while freezing the operation’s assets. In the meantime, the court will appoint a receiver over the corporate defendants while the FTC moves forward with the case. Now that the FTC has filed its complaint noting that it has “reason to believe” the law has been violated, it’ll be up to a court to decide the case.
Check out handy tips from the FTC on Prize Offers if you aren’t sure if you won or not.