Watch CBSN Live

New scam with a twist: It appears to be from the FTC

You get a letter in the mail with what appears to be the seal of the Federal Trade Commission signed by "FTC Director" Jessica Rich saying you've won a cash prize and the FTC will help you collect. It might look legitimate, and Jessica Rich really is the director of consumer protection for the FTC, but it's a scam.

The FTC issued a warning on Thursday to beware of this letter, which seeks to extract $5,000 from victims to pay for the "Legal Registration Bond" required to collect the supposed prize.

"The language might sound legal, and the letter might look legit," the FTC said in its warning. "You might look up Jessica Rich and see she's an actual FTC official. But the truth is, there's nothing legal or official about it. It's a fake letter designed to convince you to send money for a non-existent prize."

It's a classic scam to get people to pay in advance -- a tax, a fee, or a "Legal Registration Bond" -- to collect winnings that don't exist. Scam artists have long preyed on victims' willingness to suspend disbelief when the prospect of making lots of money is dangled.

But using the legitimacy of the FTC is an interesting twist and the agency wants to make sure people are aware, noting in the warning that:

  • The FTC doesn't oversee sweepstakes.
  • No federal government agency will contact you to ask for money so you can claim a prize.
  • If you enter and win a legitimate sweepstakes, you don't have to pay insurance, taxes, or shipping charges to collect your prize. If you have to pay, it's not a prize.

While government imposter scams have been sharply on the rise, they've tended to be more focused on intimidation -- like getting a call from someone posing as an Internal Revenue Service agent trying to get you to pay a supposed old tax bill.

If you do get an email, phone call or letter telling you that you've won something, you ought to check out the FTC's guide to spotting prize scams before you try to collect.

View CBS News In
CBS News App Open
Chrome Safari Continue