Sweepstakes Scam Cheated Unsuspecting Consumers, FTC Says

Payments to Collect Prize Money Brought Nothing in Return

For Release

The millions of dollars that consumers were promised were only a dream, but the consequences confronting the swindlers who tricked them are real, now that the Federal Trade Commission has charged them in federal court.

According to a complaint filed by the FTC, a fraudulent sweepstakes operation has violated federal law by sending personalized mail to millions of consumers nationwide, falsely telling them that they have won a substantial cash prize, often said to be worth more than $3 million, even though no prizes were awarded.

Urging consumers to respond immediately by sending $20 in order to receive their prize, some of the mailers described an as-yet “uncollected” but “confirmed prize” in the consumer’s name; some mailers represented that “unawarded money” has been “located and documented” in their name; and other mailers mentioned “Authorization to Disburse” and referred to a “guaranteed cash/prize amount” in the seven-figure range, according to the complaint.

The complaint also alleges that the mailers sometimes contained small print that vaguely referred to a “newsletter” produced by the defendants, but not expressly informing the recipients that they had not won a prize. Instead of prizes, some consumers received information about how to enter sweepstakes, and some consumers received more mailers soliciting more money and suggesting that the consumers had won other prizes.

Defendants named in the complaint, all Nevada-based, are National Prize Information Group Corp. (NPIGC), d/b/a Las Vegas Actionable Awards Program, Prize Search Express, Department of Unclaimed Awards, United States Sweepstakes Advisory, United States of America Patriotism Awards, National Bureau of Prize Information, Lapham Vargas and Cornell, Director’s Office, and John Rincon, individually, and as an NPIGC officer. The FTC charged them with violating Section 5 of the FTC Act, seeking a temporary restraining order, a preliminary injunction, and a freeze of their assets.

The action was brought with extensive assistance from the the Las Vegas office of the United States Postal Inspection Service and the Better Business Bureau of Southern Nevada. The Commission vote to authorize staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the District of Nevada.

NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. The case will be decided by the court.

Copies of the complaint are available from the FTC’s Web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint in English or Spanish (bilingual counselors are available to take complaints), or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov/ftc/complaint.htm. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to thousands of civil and criminal law enforcement agencies in the U.S. and abroad.

Contact Information

Media Contact:
Frank Dorman,
Office of Public Affairs
202-326-2674
Staff Contact:
Laura Fremont, Jerome M. Steiner, Jr., Janice L. Charter
FTCs Western Region San Francisco
415-848-5100