Protect yourself against award scams

Everyone loves to be a winner. Many people enter sweepstakes, contests, and lotteries hoping to win an extravagant prize – from luxury vehicles to exotic vacations. The problem with some of these seemingly good opportunities is that not all that glitters is gold.

I recently received a blue postcard in the mail claiming I won my choice of a Mercedes, $49,000 in cash, or a cruise for two to the Bahamas. The problem is I never entered any contests or signed up to win anything.

Many of these scams want you send them something first. The next thing you know you’ve lost much of your savings and the scammers are enjoying that dream vacation they promised you.

I actually called the number on the blue postcard because I was curious as to what type of information they would try to get me to divulge. I found that this was an attempt to sell me a timeshare. When I asked how they got my address, the sales rep said I signed up at a mall kiosk. When I pressed for more details she couldn’t give me the exact information.

There are all kinds of rewards scams out there. Have you ever heard of the Russian lottery scam? Americans are contacted by phone and informed they are winners of the lottery in Russia, but they must send in $1,000 first.

While some scams may not be as obvious as this, following are a few things every consumer should know about scams:

  • Many scams disguise themselves as legitimate businesses. Do your homework to determine if a business is honest and fair.
  • Legitimate companies will have you signed an affidavit before claiming your prize.
  • If you didn’t sign up for anything, more than likely you didn’t win anything.
  • Be wary if there’s high pressure to act now.
  • Federal law forbids American citizens from entering a foreign lottery.
  • Many scammers are very convincing and sound professional.
  • The most important thing to remember is: You shoudn't have to pay to win or to receive a prize!

Just remember what my grandpa always says: “What does a dishonest man look like? The same as an honest man.”

Renee McGruder is a former communications coordinator and grant writer at MMI.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.
  • The National Council of Higher Education Resources (NCHER) is the nation’s oldest and largest higher education finance trade association. NCHER’s membership includes state, nonprofit, and for-profit higher education service organizations, including lenders, servicers, guaranty agencies, collection agencies, financial literacy providers, and schools, interested and involved in increasing college access and success. It assists its members in shaping policies governing federal and private student loan and state grant programs on behalf of students, parents, borrowers, and families.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.