The Federal Trade Commission warned on Monday, October 26, that scammers are posing as well-known charities and telling people they won a sweepstakes. The catch comes next. Before any prize is released, the caller or the ad asks for a payment or a Social Security number.

The warning came as a consumer alert from the staff of the FTC’s Bureau of Consumer Protection, titled “Spot scammers impersonating well-known charities and sweepstakes.” It says scammers impersonate many kinds of organizations, and reputable charities are among them. In one version, the impersonator claims a person won a charity-sponsored sweepstakes because of a donation to that charity.

A prize story built on a donation

The pitch works because it sounds plausible. Reputable organizations and charities do run sweepstakes, the alert notes, so a call about a drawing from a charity does not sound strange on its face. A person who has given to a cause, or who knows the name from the mail, is more likely to stay on the line.

Scammers also borrow the name outright. The FTC says they may use a real charity’s name or a similar-sounding one in phone calls, in social media ads or in other ads. The name does the persuading, and the prize is the lure. A sweepstakes is a drawing decided by chance, and entering one is supposed to cost nothing, which is the detail the scam tries to bury.

For anyone who has just taken a call or read a message like this, the question is narrow. Does the prize require a payment or a Social Security number? The FTC’s alert settles it in one line: “Only scammers demand you pay or give them personal information like your Social Security number to get a prize.”

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Caller ID and search ads can both be faked

The alert warns against trusting the screen. Scammers can fake caller ID, so a display showing a government agency, a company name or a real phone number proves nothing about who is calling.

The FTC says to research the charity before responding. Searching the contest or company name with words like “complaint,” “review” or “scam” can turn up reports from other people, but the agency cautions against relying only on the first results. Impersonators sometimes buy ads on search engines, so the paid links at the top may belong to the scammer.

People who want to keep giving to charity can start with the FTC’s page on donating safely and avoiding scams. The point of that advice is to deal with the right charity, reached on the person’s own terms rather than through an unsolicited call.

The alert’s instruction on money is flat: never pay to get a prize. A caller who pushes for an answer today, or who gets annoyed when a person says no, is following a script that real contests do not need.

What a payment or a number hands over

The two demands in the alert do different damage. A payment is money gone, and the FTC says it does not end there. People who pay to collect a prize lose the money and then get more calls, mail and spam about sweepstakes.

A Social Security number is the more lasting loss. With the number, a thief can try to open accounts or file a tax return in someone else’s name. That is why a “prize” that asks for the number is not offering anything at all.

Social Security’s inspector general tracks the same ask. Its quarterly scam report for April through June lists requests for a Social Security number or other personal information among the common features of impostor complaints it received.

The alert is one of several the FTC has posted this month on impostor calls. Another, titled “The FTC is not calling to deactivate your phone number,” points at the same habit of borrowing a trusted name to get a payment or personal details.

Real prizes are free

The FTC’s rule is short and has no exceptions in the alert. Real prizes are free, and anyone who asks a winner to pay to claim one is a scammer. The agency adds that it is illegal to require a payment or a purchase to enter a sweepstakes or to improve the odds of winning, and that a legitimate sweepstakes is based on chance. The rule applies whether the offer arrives in a call, a social media ad or any other ad, and whether the sponsor is named for a charity the person has heard of or one that only sounds familiar.

The FTC explains how to spot fake prize, sweepstakes and lottery scams on a separate page. Anyone who has already paid or given out a number can report it to the FTC at ReportFraud.ftc.gov.

What the alert leaves with donors is a simple test. A call that uses a favorite charity’s name can still be a stranger’s call, and the only thing that proves a prize is real is that it asks for nothing first.

Did a prize call use a charity’s name?

A fake prize call rarely stops at the first answer. A payment gets a second call, and a Social Security number can be used to open credit or file a return in someone else’s name, the damage the FTC’s alert is warning about.

Scam-Proof Your Accounts in a Weekend works on that exposure before a caller reaches it. It shows how to freeze credit at all three bureaus, free by federal law, and how to get an IRS Identity Protection PIN so no one can file a return in your name.

It lays out ten moves in weekend order, about four hours of work, with the steps that protect the most money first.

Get the 10-move weekend guide to freeze your credit and lock your accounts →

More Financial Reading

• 21 Ways to Stretch a $2,087 Social Security Check
• 15 Places to Find Your Share of the $4.25 Billion States Give Back
• The New $6,000 Senior Deduction and 14 More Tax Moves for Retirees

This article was produced with AI assistance and edited for accuracy against the sources linked above.