Lottery fraud has become increasingly prevalent in India, and people have lost lakhs of rupees in these scams. Lottery fraud is ranked among the top three online frauds. Many people have lost hard-earned money to fraudsters because of their greed to win the lottery.

What is lottery fraud?

Lottery fraud involves phone calls, emails, SMSs, and WhatsApp messages informing recipients they have won an enormous amount of money in a lottery. It is crucial that the recipient deposits money as processing fees or transfer charges to receive the lottery amount. As soon as the funds are sent, the fraudsters will take off with the money.

Real-life examples of lottery fraud

Case 1 - A former employee of the Central Government was informed by SMS that she had won over Rs 47 crore (over 5 million pounds) in an overseas lottery. Since she believed the message to be legitimate, she responded by emailing and contacting the fraudsters.

She had to pay a certain amount as payment for Indian Customs clearance, anti-terrorism certificates, and Income Tax approval before receiving the lottery money. In anticipation of receiving Rs 47 Crores, she transferred Rs 38 Lakh in installments to a variety of bank accounts that the fraudsters had provided. Her entire life savings, including her provident fund and gratuity money, was stolen by the fraudsters.

Case 2 - In 2014, after a retired agriculture scientist had taken an online quiz, a woman contacted him claiming she was calling from Shell Oil Company in the United Kingdom. Since he was unfamiliar with online fraud, he believed it to be true and began interacting with the fraudster. The fraudster led him to believe that he had won Rs 5 Crore in prize money and in order to receive it, he had to transfer money towards fees towards customs procedure, RBI sanctions, and other fraudulent charges.

Upon believing this to be true, the victim transferred huge sums of money to numerous bank accounts as instructed by the fraudsters on several occasions until his death in December 2014. The victim had drawn on his savings in addition to taking out loans on his LIC policies and pledging property to claim lottery money. In total, he has transferred more than Rs.1 crore to the bank accounts provided by the fraudsters.

Also Check: 62-year-old lost 12.26 lakhs to a travel agent fraud

Tips to Avoid Lottery Scams -

1. It is best not to respond to unsolicited offers received via email, message, phone, or social media.

2. Don't talk to anyone about your personal or financial details over the telephone.

3. Transferring money as an advance fee to anyone who contacts you in the name of a lottery is a bad idea.

4.  Be careful when investing in schemes that sound too good to be true. Do not invest in unregulated companies or entities.

5. The use of digital escrow platforms for payments is recommended. When you make an online payment with Escrow, no financial information is shared. 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 #175. 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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