How do lottery scams work?

How do lottery spammers make money?

People send e-mail spam because they make money doing it. That’s the only reason. So how do the spammers who send millions of “You have won the jackpot!” messages make money?

E-mail lottery scams are actually a variety of advance fee fraud. They really don’t have anything to do with lotteries per se — lotteries are just an easy hook the con artists use to try to catch suckers (you). There are legitimate online lotteries, and the scammers often use the names of these legitimate businesses in their messages. But that doesn’t mean there’s any connection between the scammers and the legitimate businesses: anyone can use a fake name or pretend to represent a company they have nothing to do with. The basic rule to remember is: if you didn’t enter, you can’t win. No legitimate online lottery awards prizes to people who haven’t entered its contest.

All advance fee frauds, such as lottery scams and the (in)famous “Nigerian” 4-1-9 scams, promise a huge return of money, if only you’ll advance a small amount to release the trapped funds.

Suppose I want to scam you out of some money. Here’s what I can do. I can type up a fake message that says, “Congratulations! I represent the Euro-Millions Lottery and you have just won our jackpot. Please send me your full contact information and we will put you in touch with our claims agent right away.” Sometimes I add a little kicker that says you have to keep your winnings confidential until the award has been confirmed. I then send this message randomly to thousands or millions of people. That’s stage one.

If you take the bait and contact this “lottery agent,” he will extend more hearty congratulations, tell you you’re a great player and a wonderful contestant, and generally draw you into the scheme. If you stay on the hook, he’ll then say the money is ready to be transferred to your bank account, or sent to you as a check. Yeah! You’re a millionaire!

But there’s just this one thing: the government requires a tax payment of (say) $1000 before the transfer can be completed. Or maybe bank fees of $500 must be paid to insure against theft in transit. But heck, you’ve got millions coming your way in a few days, so what’s a few hundred or a few thousand, right? Sucker! If you send the advance fee, suddenly your “lottery agent” will disappear, he’ll throw away the $20 cell phone he was taking your calls on (probably in a foreign country), and you’ll never hear from him again. There was never any lottery, you were not a winner, and the scammer got what he wanted: your money.

And now the scammer is off to write another fake message, send it to another million people, and run the scam all over again on someone else.

Do people fall for these scams? You bet they do. If they didn’t, the business of e-mail spam wouldn’t exist. It’s as simple as that.

—The Scam Hunter