On 7/1/08, the California Lottery announced that they are using undercover agents to sting dishonest retailers, who cheat lottery winners out of their prizes.
The press release on this matter pointed to a case in Morgan Hill, California where a dishonest retailer (and another individual) are being charged with grand theft of lottery tickets ranging in value from $500 to $25,000.
I decided to see if I could find any additional information on arrests and discovered another one that was reported by cbs13.com in Lodi, California.
CBS 13 in Sacramento, with cameras rolling, approached Baljut Kang (one of the two arrested in Lodi), who refused to talk at first. Eventually, Kang stated to the reporter that the undercover agents found "some ticket in the garbage," which supposedly made them think she and her son were committing fraud.
According to the article, an undercover agent turned in one ticket worth $990 and received only $24. Another ticket was presented at the retailer worth $25,000 but the agent was given $10 for it. The article also states that this was the result of a statewide lottery sting, which might mean there were other retailers caught.
The official press release indicates that this is the first enforcement effort of this kind anywhere in the country. This made me wonder if other states should also run sting operations.
While dishonest retailers getting caught cheating customers is something new, lottery scams are big business for criminals. Spam e-mails, unsolicited telephone calls and even snail mails are used to dupe people into thinking they have won the lottery. Frequently, a person is then asked to negotiate a fraudulent instrument to cover tariffs and taxes and wire the money across an international border.
The California lottery has an interesting page, which can be seen on their website warning the public about this type of activity.
In February, I did a post on the eve of a $270 Mega Million Lottery prize, about fraudsters attempting to impersonate the California lottery to trick unsuspecting people into cashing worthless checks.
Please note that scams — where unsuspecting people are duped into cashing worthless checks and wiring the money before the financial institution catches on — aren't limited to the lottery variety. Other varieties involving bogus financial instruments include work-at-home (job) scams, secret shopper, romance, and auction scams.
Known bogus items in circulation are Postal Money Orders, Travelers Express (MoneyGram) Money Orders, American Express Gift Cheques, and Visa Travelers Cheques.
A good site to learn more about scams involving fake checks is FakeChecks.org.
In California when you claim a ticket for a prize under $600, the retailer has to validate it in a machine, which prints a receipt showing exactly how much the prize was for. A good idea is to make sure you take a look at this receipt to ensure you are getting the right amount of money.
If you note suspicious activity, I'm sure that the dedicated law enforcement personnel at the California Lottery would like to hear from you. They can be reached at 1-800-LOTTERY.