The rate of lottery fraud in India has increased rapidly, just as with other frauds, and many people have lost lakhs of rupees as a result. Lottery fraud is one of the top three online frauds in India. Several people have been scammed by fraudsters while trying to win a lottery.

What is lottery fraud?

Typically, lottery fraud starts via phony phone calls, emails, SMSs, WhatsApp messages, or letters that promise the recipient of the message has won massive amounts of money. In order to receive the lottery amount, a recipient must first pay the processing fees or the transfer charges. Fraudsters will flee with the money once the amount was sent.

Real-life examples of lottery fraud

Case 1

An Indian government employee, who had worked for the central government in Bengaluru, received a text message claiming to have won 5 million pounds (over Rs 47 crore) in an overseas lottery. As she believed that the message was true, she immediately responded to the message by email and mobile phone.

In order to receive the lottery money, she was required to pay for Indian Customs clearance and anti-terrorism certification, as well as a tax authorization.

She transferred Rs 38 Lakhs to various accounts provided by the fraudsters in 20 installments, believing she would receive Rs 47 Crores. Afterward, the fraudsters were nowhere to be found.

Case 2

A retired agriculture scientist participated in an online quiz in 2014, and the very next day he received a call from a man who said he was from Shell Oil Company in the UK, which had recently started a lottery. Knowing nothing about online fraud, he thought it was true and contacted the fraudster. The fraudster informed him that he had won a prize of Rs 5 crores and to receive the money, he had to transfer some money towards fees for customs procedures, RBI sanctions, and other fraudulent charges.

The victim was convinced by fraudsters that this was true, and as such, he transferred huge sums of money to various bank accounts on numerous occasions until his demise in December 2014. To obtain lottery money, the victim used his savings and LIC policies for collateral.

The scientist’s wife was contacted by fraudsters after his death, and when she answered, they claimed he had won a lottery and asked her to claim the cash on behalf of her husband. She trusted them and transferred a large sum of money until May 2017. They lost close to Rs 1 crore on this scam.

See Also: How to avoid fake online shopping portals scam?

Tips to Avoid Lottery Scams-

1. The lottery scam can be avoided by not responding to unsolicited offers through e-mails, texts, calls, or other social media.

2. Don't give out your banking information or personal details via the telephone to anyone.

3. Never send money to anyone in the name of a lottery who contacts you with an advance fee request.

4. Avoid investing in companies or entities that are not regulated and always be careful when you invest in schemes that seem too good to be true.

5. It is recommended that digital escrow platforms be used for payment. When making an online payment with Escrow, you do not share your financial information with anyone. There is a platform for escrow called Vouch

How does digital escrow work?

In digital escrow, a third-party account holds the money deposited by the buyer until the seller fulfills the terms of the contract. The escrow company supervises the transacting parties.

What is the role of Digital Escrow in preventing online fraud in India? 

Digital escrow services are offered by many companies in India. Among the most trusted is Vouch.

Vouch’s Digital Escrow service is a transparent way for buyers and sellers to build trust and secure a clean transfer of product and payment. Sellers can feel assured that they will be fairly compensated promptly, and buyers will feel confident that their order will be delivered as expected and on schedule. Vouch Digital Escrow keeps you updated and informed at every step of the transaction process till the end. Vouch’s professionals are always available to assist you with all queries that you may have during the entire transaction process. 

There is no scope for deceit or fraud since the payments, shipping, delivery, and execution are carried out under the honest and watchful eyes of the Vouch’s professionals. With Vouch, any business transaction becomes transparent, uncomplicated, and hassle-free. If you ever come across a fraudster asking for OTP, asking you to scan a QR code, or asking you to click on phishing links, you can simply refuse and ask him/her to proceed with the transaction through Vouch.

This is Fraud Story #106. Check back here for more fraud stories and scams that you can protect yourself from.

Safety is not just about protecting your credit, debit card number, and UPI accounts. It's about having control of your money till you've received the product or service you bought online!

----------------------------------------------------------------------------------Note: This is a good-faith initiative to educate the world about avoiding frauds like these and how to act when you're becoming a victim of such a situation. 

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