Competition Bureau

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Need to Pay to Claim a Prize? It could be a scam!

Ottawa, June 16, 2006 -  The Competition Bureau announced today that it has collaborated with Canada Post and a UK consumer protection authority to return money to thousands of Canadians who responded to an alleged scam.

The Trading Standards Service of the Cheshire County Council contacted the Bureau about a potentially fraudulent mail scam originating from the UK. Consumers from a number of countries, including Canada, received letters encouraging them to send money to enter a contest or pay a “judging or processing” fee to claim a prize.

The Trading Standards Service seized letters addressed to the fraudsters, which contained cheques, money orders or credit card information, and handed them over to the Bureau. Canada Post has collaborated with the Bureau to ensure that the letters are returned to the senders.

Under the Competition Act, it is a criminal offence for anyone to send consumers a prize notice requiring them to pay before collecting their winnings, unless adequate and fair disclosure is made, and the recipient actually wins the prize.

Tips for consumers to protect themselves:

• Remember that you should not have to pay to collect a prize. If you are asked to pay money, be wary.
• Make sure that you read all the details about the offer contained in the promotional material very carefully.
• Do not assume that you have already won something.
• Do not send money up front.  Recovering losses from lottery scammers will likely prove very difficult, especially in the case of foreign-based scammers.
• Do not reveal bank account or credit card-related information to a business or person you do not know.
• Be on guard!  Responding to an offer from a lottery scammer could mean that your name might be added to lists of potential victims which are made available to deceptive and fraudulent marketers.

Report it:

Consumers who believe they have been a victim of a scam or who are aware of deceptive marketing practices are encouraged to report it to the Bureau by calling 1800 348-5358 or by visiting the Bureau’s Web site at: www.competitionbureau.gc.ca. Consumers may also contact PhoneBusters, the Canadian Anti-fraud Call Centre, at 1 888 495-8501. 

The Bureau is a member of six law enforcement partnerships involving municipal, provincial and federal agencies, as well as law enforcement agencies in the United States and the United Kingdom, aimed at investigating and prosecuting cross-border mass marketing fraudsters.

The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality service. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.

For media enquiries, please contact:
Pamela Wong
Communications Officer
Competition Bureau
(819) 953-7734 

For general enquiries, please contact:
Information Centre
Competition Bureau
(819) 997-4282
1 800 348-5358