Sweepstakes Deception? What You Should Know About Those Offers in the Mail

The recent Powerball jackpot may have you dreaming of becoming an overnight millionaire someday, and while the California lottery definitely delivers, many promises of instant riches are not at all what they seem.

Delivered to Southern California mailboxes every day are official-looking notifications meant to make you think you’ve struck it rich.

"Two million dollars? I won $2 million. I didn’t go into any contest, I don’t know why I won this," said homeowner Evelyn Parra, describing her reaction to receiving one such letter in the mail.

The notice from the "Award Notification Commission" in Kansas said Parra could accept a single check, or opt for annual payments over 30 years.

But she checked the fine print and saw that in order to collect the prize she needed to sign and mail back the form along with a prize "delivery fee" of $12.99.

"And I wondered how heavy must that check be that they’re asking for postage and handling," she said.

The company behind the mailings, Next Gen Inc., posted a video on its website of a man described as the winner of a $100,000 prize in 2014.

The site lists dozens of other winners of various cash rewards — all from 2014 or before.

Consumer advocates say the site and the mailings aren’t breaking any laws, but worry people are being tricked into thinking they’ve already won and that they need to pay to get their prize.

The companies behind these mailings hope that people will send them the so-called shipping and handling fees, often with no intention of delivering on a prize, according to Steve McFarland, chief executive of the Los Angeles Better Business Bureau.

"We’ve had consumers lose tens of thousands of dollars trying to recover their so-called sweepstakes earnings," said McFarland.

The NBC4 I-Team reached out to Next Gen Inc. numerous times, by phone and email, to ask to be put in touch some recent winners, but never received a response.

In the meantime, the Better Business Bureau has given Next Gen Inc. a failing grade and says your best bet is to steer clear.

"The major thing to remember about sweepstakes: if you have to pay a penny, it is not a sweepstakes," McFarland said. "If it seems too good to be true, it’s probably not true."

The Federal Trade Commission emphasizes that legitimate sweepstakes are free. In fact, it’s illegal to ask to pay for collecting winnings, including any taxes, shipping and handling charges and processing fees.

And if you didn’t enter a sweepstakes, there’s no way you can win.

Jackpot alerts are also starting to arrive by text message. If a promise of a big sweepstakes prize pops up on your phone, your best bet is to ignore it.

For more information on how to avoid falling victim to these so-called sweepstakes, the Better Business Bureau offers these tips

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