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10 Recession Era Scams

        Money | Scams

6
Sweepstakes
The idea of winning large sums in a sweepstakes entices many people to spend money. It's unlikely that participants will win a thing.
The idea of winning large sums in a sweepstakes entices many people to spend money. It's unlikely that participants will win a thing.
Mel Yates/Taxi/Getty Images

The good news is, you've won! The bad news is, the prize is an opportunity to be scammed. Sweepstakes scams prey on fixed and low income individuals -- often the elderly -- luring them in with promises of big money. More often than not, the sweepstakes "winner" ends up spending money and never sees a dime in return. According to the FTC, "scam artists use the promise of a valuable prize or award to entice consumers to send money, buy overpriced products or services, or contribute to bogus charities" [source: FTC].

Even the feds get used to set up new victims. In a new scam, someone who claims to work for the FTC calls to inform a victim that he's won a lottery. To receive the prize, all the "winner" has to do is pay taxes and insurance on the winnings. The winner is directed to wire money or send a check for up to $10,000, a small percentage of the supposed jackpot. The prize money, however, never materializes.

With jobs and money hard to come by, it's easy to get wrapped up in the allure of big winnings. It's important not to lose your head. As the old saying goes, "If it sounds too good to be true, it probably is."


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