Contests and sweepstakes can feel like a fun chance for folks to win big, but they also tend to attract scammers looking to exploit that excitement and trust. Perhaps you might expect that from shady, small-time fraudsters, but would you ever think a large, well-known company would go in for such schemes? Well as it happens, you may have heard about the Publishers Clearing House debacle.
According to the FTC, Publishers Clearing House “used language and designs on its website and in its email marketing that tricked consumers, including many older adults, into believing they had to buy things on the PCH website to enter a sweepstakes. Or that doing so would improve their chances of winning a prize. Customers who did buy something on PCH.com were in for a few surprises. (And they didn’t involve someone arriving at their door with a giant check and a TV crew).” Turns out it’s actually illegal for a company to suggest someone pay to enter a sweepstakes contest, or that they can increase their odds of winning by purchasing something.
PCH also hid shipping and handling fees that added an average of 40% to customers’ orders, and their claims that orders were risk-free turned out to be bunk, as customers had to pay the shipping costs to return merchandise. Ultimately, PCH ended up agreeing to pay $18.5 million to provide refunds, among other things, in a settlement.
The lesson here? It’s worthwhile to be mindful about— or even wary of— contests and sweepstakes, even when they’re from a widely-known organizer. Protect your information and financial security by keeping these 5 tips in mind:
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- Research the legitimacy of sweepstakes and contests you’re thinking of entering.
Always verify the legitimacy of the organization hosting the sweepstakes or contest. Look for official websites, contact information and other indicators that the organizer isn’t trying to swindle you.
- Research the legitimacy of sweepstakes and contests you’re thinking of entering.
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- Read the rules.
Legitimate contests have clear rules and guidelines. Be cautious if the rules are vague or seem too good to be true.
- Read the rules.
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- Entry fees are a no.
Genuine sweepstakes and contests don’t require payment to enter. If you’re asked for money upfront, it’s likely a scam.
- Entry fees are a no.
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- Protect your personal information.
Never share financial details. Legitimate sweepstakes winners won’t ask for your banking information or social security number.
- Protect your personal information.
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- Educate yourself about scams.
Staying informed and keeping up with the latest scams and frauds will help you avoid getting duped. Check back regularly for our Fraud Friday updates about common scams.
- Educate yourself about scams.
Remember, GCSB is committed to assisting our members in protecting their financial well-being, so don’t hesitate to reach out if you have any concerns. Your security is our priority.
Stay safe, stay vigilant, and let’s keep your finances secure together.