Don’t Be a Victim!  

U.S. Postal Inspectors offer information, advice on growing problem of prize and sweepstakes fraud targeting the elderly

At least that’s what her financial advisor told her earlier this year. Now, however, he’s worried. Mrs. Nelson has gotten caught up in something she calls “playing sweepstakes games” and he refers to as “gambling.” Postal Inspectors, who comprise the federal law enforcement branch of the U.S. Postal Service, have yet another name for it: telemarketing fraud. They would be pleased to find and arrest the unscrupulous scam artists who use illegal come-ons to swindle Mrs. Nelson and other elderly victims like her out of their life savings.

Postal Inspector Mike Ellis of the Postal Inspection Service’s Oklahoma City office interviewed Mrs. Nelson after Bert Mackie, president of Security National Bank in Enid and a former member of the U.S. Postal Service Board of Governors, asked for advice.  

“We need to raise awareness of the problem,” said Mackie, “because if these illegal operators found Mr. Nelson in Enid, they’ll find victims to target in other towns.”

Inspector Ellis agreed. His specialty is mail fraud, and the story he heard from Mackie is one he’s heard far too many times.

“These promoters set up phone rooms, called boiler rooms, where they promote crooked lotteries and sweepstakes schemes that ‘guarantee’ you’re a winner—for a fee. Elderly people, who are more gullible and may be hungrier for attention, are their victims of choice,” said Ellis. He listened as several bank officials, as well as Mrs. Nelson herself, told him about the Enid scam.

Mrs. Nelson (who asked that her real name not be used) began receiving sweepstakes offers in the mail shortly after her husband entered the nursing home.

“They’d tell me I won and that all I had to do was send in $50 or so and I’d get free stuff, so I kept playing,” she said. “They’d call me, too, and they were very nice on the phone.”

Pretty soon, Mrs. Nelson was getting two or three calls a day and a grocery sack full of mail weekly—news of “prizes” she had “won,” but could collect only by sending anywhere from $50 to $2,000 by overnight mail. One day she asked Joan Keeling, assistant vice president of Security National Bank, how to send a large amount of cash through the mail. When Mrs. Keeling heard what it was for, she examined Mrs. Nelson’s account transactions and found the elderly woman was writing as many as 90 checks a month to participate in sweepstakes games offering “free prizes.”

“Mrs. Nelson is a very trusting person, and I think she’s lonely now that her husband is no longer at home with her. She likes the attention they give her,” Keeling said.

The situation came to a head when a clerk noticed Mrs. Nelson sitting in the bank parking lot for several hours one day last May and went out to ask her what was up. It turned out that Mrs. Nelson had been told by an Atlanta firm that she was the lucky winner of $1 million—if she would pay a fee of $5,000. Mrs. Nelson had wised up. She told Keeling that she wouldn’t give them her money until they gave her the $1 million. Someone named Sarah told her they would fly to Enid that day to make the exchange. Needless to say, Sarah never showed, although Inspector Ellis believes the Atlanta firm will be contacting Mrs. Nelson again soon.

Postal Inspectors each year arrest nearly 2,000 suspects for mail fraud—and the Inspection Service is just one of many federal agencies that target fraud scams. And although people aged 60 and older account for 26 percent of all telemarketing fraud victims, 60 percent of people in that age group are victims of prize or sweepstakes fraud—which are basically “subcategories” of telemarketing fraud.

That number may sound high, but the actual figure is probably much higher. Victims of prize or sweepstakes fraud often never report it to authorities. It’s embarrassing, even humiliating, to admit you’ve been had.

One way you can help protect elderly family members or other loved ones from unscrupulous con artists is to become aware of the types of scams being used—including phony sweepstakes, “guaranteed” prize schemes, easy credit deals, fake employment advertisements, and bogus money-making opportunities.

The Mail Fraud Statute of 1872 makes it a federal crime to use the U.S. Mail to further a scheme to defraud, and the 1994 Omnibus Crime Bill added private carriers to the statute. Legitimate sweepstakes promotions allow anyone to enter and cannot require a purchase or fee as a condition of playing. “Free prize” promotions that ask for shipping or handling charges, registration fees, taxes, auditor’s expenses, or storage fees are against the law. Any high-pressure sales pitch from telephone callers requiring that you decide to make a purchase or investment right away are pretty sure to be bogus. Especially when they offer to send a private courier to pick up a check.

Some state lotteries and games conducted by certain Indian tribes may use the mail to conduct business, but it is illegal for any foreign lottery to solicit business through the mail. Since April of this year, Postal  Inspectors, along with agents of the U.S. Customs Service, have seized over 2 million pieces of foreign lottery mail. Postal  Inspectors also backed legislation that was passed by the House this year requiring restitution for victims of federal crimes.

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