The envelope proclaims it, as does the official-looking letter inside: You've already won! And the prize is from a well-known source! Or is it? Hiding behind the cyberspace curtain, scammers have adapted their tricks. Now, you may be fooled by a scam because it looks legitimate, because the name and logo are familiar and trustworthy. The popular realty company RE/MAX is the latest familiar name to have its name "borrowed" by scammers for a "Sweepstakes" that is nothing more than a scam.
Some Sweepstakes Legitimate, But Not All
Some sweepstakes advertisements are legitimate, and many invitations to enter are accompanied by an offer to purchase magazines or vacation rentals, or to make a donation to a charity. Consumers often end up spending money in the hope that doing so will increase their chances of winning.
If you receive a notification of a prize in a sweepstakes you never entered, if calling a toll-free number is required to "accept" your prize, or if you're asked to reveal any personal or confidential financial information before you can receive your prize: BEWARE! All of these methods are designed to grab your attention and instill a sense of urgency. One recent sweepstakes scam used the familiar name and logo of RE/MAX, complete with the appropriate color scheme. The unlucky consumers who responded to this mailing found themselves at risk for identity theft and the loss of their own money.
Never Disclose Confidential Financial or Personal Information
A key red flag is a prize notification for a contest you did not enter. The enticement of receiving a prize can cause you to forget about the risks of disclosing confidential information. Even basic information such as your bank account number, bank routing number or credit card number can be a dangerous starting point for a scammer to access your financial resources.
It can be extremely difficult to locate and identify scammers, especially those who operate via e-mail or the Internet. Once you have revealed your personal information to an unknown source, it might be impossible to retrieve and safeguard the information. Any efforts to "undo" such disclosure, or to cancel your "prize acceptance," may well lead to a dead end. Ask for verification of the source or, in the case of a well-known source similar to RE/MAX, check its Web site or contact the company headquarters to see if the prize offer is legitimate.
Contact Authorities Immediately
Take prompt action if you've disclosed personal financial information to a source you suspect isn't legitimate. Call your bank or financial institution immediately and provide all the details you can about the events. Contact the Better Business Bureau, your local police department or prosecutor's office, so they can investigate and alert others in the community if indeed the scheme is fraudulent. An attorney can help you assess whether legal recourse is available.
Nearly every type of legal action in both the civil and criminal context has time limitations, known as "statutes of limitations". However, actions for fraud or deception, or where concealment has occurred, have much longer time deadlines. Thus, even if you have been the victim of a scam and a period of time has passed, it may be worthwhile to retain documentation about the event, for later use in case the scammer's identity is eventually known.
If there are enough consumers harmed, prosecutors might take legal action against the wrongdoers once they are identified. Also, you may have an opportunity to participate in a civil or criminal proceeding to hopefully get some of your money back.
Questions for Your Attorney
- If a scam uses the name of a legitimate business, or an actual person, would the business or person face any liability from scam victims? Is there any duty to prevent or stop the improper use of your name or business name or insignia if you know about it?
- Do homeowners' insurance policies offer coverage for identity theft if I fall victim to one of these scams? Is there specific coverage available, or could it fall under an existing area of coverage?
- Do local police have authority over a scam if someone within the police department's jurisdiction is victimized? Do they have to investigate if I make a complaint?