Fake jackpots, real losses: These are some of the biggest lottery scams

Have you ever won a lottery without buying a ticket? Of course not. It's hard enough to win when you have one or even a dozen tickets. But brazen scammers across the country are reaching out to unsuspecting people, telling them they're big winners and that the only thing they need to do to claim their prize is send them money to pay taxes or fees on their jackpot.

Of course, the trick is that there is no jackpot, and the money you send is going straight to criminal organizations.

One study indicates that Americans lose $351 million to lottery scams each year, and many experts believe this number may be low because many victims may not report their losses out of shame, fear, or embarrassment.

While most of us are too savvy to fall for these obvious tricks, once in a while, a scammer will get their hooks in someone, and the results can be financially devastating. Understanding how these scams play out in the real world is one of the best ways to prevent yourself from becoming a victim.

Fake badges. Real theft

Lottery scammers Rajay Dobson and Leonard Luton thought they had found the perfect victim when they conned an elderly Colorado woman, whose name has been withheld for her protection.

The scam began, as so many do, with the two men convincing the woman that she had won $2.8 million and a new Mercedes-Benz in a lottery. However, they told the victim that, to secure her prize, she would need to send them thousands of dollars in “fees”.

Initially, the woman resisted their overtures, but Dobson and Luton were relentless, calling hundreds of times and demanding that she transfer the money to them. Eventually, they convinced her to mail them packages of cash as well as six new iPhones.

However, even this wasn't enough for the scammers. In October 2018,  the two men traveled to the woman's home in Estes Park, CO, and knocked on her door at 1:30 in the morning.
Dobson told her he was an FBI agent, even showing her a fake badge. He claimed he was investigating the scammers and demanded that she give him a package containing $65,000, which he said was evidence of a crime.

Eventually, someone tipped off the authorities, who launched an investigation into the men. When Luton returned to the victim's home to take more money from her, FBI agents were waiting, and they arrested him for fraud and theft. At the time of his arrest, police discovered that he was carrying one of the iPhones that the woman had mailed him.

Prosecutors charged Luton in the Federal Court and presented evidence showing that he and his accomplices defrauded their victim of nearly one million dollars. Luton was found guilty and sentenced by a judge to spend nine years in Federal prison and pay $881,000 in restitution.

Dobson initially evaded capture, but law enforcement officials found him in Jamaica, where he was arrested and extradited to the US. He pleaded guilty to mail fraud, was sentenced to five years in prison, and was ordered to pay $881,000 in restitution. Acting U.S. Attorney Matt Kirsch said:

Lottery scams are just one way that fraudsters prey on the elderly and vulnerable victims. Together with our law enforcement partners, we are working to protect the elderly and to make scammers like Luton face justice.

Briefcase full of cash

For three years, Maryland brothers Dwayne and Wayne Henry worked with Florida resident Nickoy Campbell to carry out one of the largest and most successful lottery fraud schemes in the country.

The trio was part of a criminal network that was active from October 2020 to December 2023. Prosecutors believe that collectively they stole at least $9.5 million from their victims.

The alleged criminals specifically targeted people who were 55 and older from across the country. They would reach out to their targets by email or phone, telling them they had won a multimillion-dollar lottery prize but needed to pay thousands of dollars in fees to receive it.

In one of their schemes, they told a victim that she had won $8.5 million from the Publishers Clearinghouse Sweepstakes but that she would need to send them $100,000 to claim it. The woman sent a $40,000 cashier’s check, which Campbell deposited into his personal bank account. The victim never received her millions.

In another instance, the criminal group sent a victim a locked metal briefcase that they claimed contained millions of dollars in cash. They told her she would only receive the unlock code after paying them thousands of dollars in taxes and fees, and that if she tried to force it open, a dye pack in the case would ruin the money.

While the scheme was successful initially, it unraveled after a multi-state investigation by several law enforcement agencies, including Homeland Security Investigations (HSI), Postal Inspectors, and the Prince George’s County Police Department.

All three men were arrested in 2023, charged with mail fraud, and face up to 20 years in prison for their crimes. HSI Baltimore Special Agent in Charge James C. Harris stated:

The Henry brothers’ crimes are far from victimless. They contrived and executed an intricate scheme to steal hard-earned money from honest and trusting Americans. HSI Baltimore will continue to investigate such criminal activity to provide safer neighborhoods for Maryland residents.

Elder abuse

27-year-old Shanile Lyle went on a one-woman crime spree in 2020, when she convinced several senior citizens that they had won a lottery jackpot and successfully conned them out of $675,000, according to federal prosecutors.

Her style was to call senior citizens, pretending she was a lottery official, and convince them they had won millions of dollars. As in the previously discussed scam cases, she would then convince her victims to send her thousands of dollars so she could release the non-existent prizes.

Lyle's first known victim was a 98-year-old woman living in Hawaii. Lyle convinced her that she had won $6 million from the Publishers Clearinghouse Sweepstakes, and eventually persuaded her to send her 22 checks totaling $500,000.

Next, Lyle moved on to a 75-year-old woman in Kentucky, whom she convinced was the winner of a $2 million lottery prize and a new car. This time, in addition to talking the woman out of $30,000, Lyle also convinced her to send thousands of dollars' worth of cell phones and gift cards.

Her final known victim was an 86-year-old grandmother in Indiana, whom Lyle talked out of $20,000 by once again convincing her she had won millions of dollars and a new car.

Fortunately for senior citizens across the country, Lyle was finally caught and arrested by federal authorities in 2020. She was charged with several felonies, and in 2022, she pleaded guilty to a single felony count of operating an unlicensed money-transmitting business, which carries a sentence of up to five years in prison.

Hoosier hustle

Tricking seniors out of their money isn't the only way to run a lottery scam. In 2015, brothers Jackie and Joseph Parsley, and Joseph's wife Ashlee, took advantage of a deceased relative's convenience store to scam the Indiana Lottery out of a $2 million prize.

Their scheme began when Jackie and Joseph's grandmother passed away and her son, Jimmy, became the executor of her estate, which included the convenience store and lottery retailer she owned, Parsley’s Package Store and Liquor in Plainfield, Indiana.

As Jimmy prepared to sell the store, state lottery officials deactivated its license, requiring the store to return all remaining lottery tickets to the state, which would repay their face value.

However, Jackie stole some of the unused tickets, and he later convinced state lottery officials to reactivate the store's lottery license, pending its sale to a new owner. Jackie scratched and scanned the barcodes on his stolen tickets at the store until he found a $2 million winner.

Because Indiana law says that people can’t buy lottery tickets from the stores their family owns, Jackie gave the ticket to Ashlee, who, at the time, was Joseph's fiancée. Ashlee and Joseph traveled to the state lottery headquarters together, where they presented their winning ticket and collected a check worth $1,139,948.09.

The pair then went on a spending spree, buying multiple cars and a new home in a lakeside community.

Their scheme might have ended with a happily ever after for the criminal trio, except for one catch. Their Uncle Jimmy learned that someone had won a jackpot from his store. He knew that his lottery license had been deactivated, so he assumed the ticket must have been stolen.

After he called state lottery officials, they reviewed surveillance footage from the store at the time the ticket was scanned and determined that Jackie, not Ashlee, found the winning ticket.

Jackie, Joseph, and Ashelee were all arrested in 2015 and charged with several felonies, including corrupt business influence, false passing of a lottery ticket, theft, forgery, and money laundering.

As part of their legal proceedings against the group, prosecutors seized all the goods and property they purchased with their stolen lottery money, including three pickup trucks, two SUVs, a trailer, a bank account with $550,000, and a lakeside home under construction.

Protect yourself

The best way to protect yourself from a lottery scam is never to believe a phone call or email telling you that you won a lottery that you never entered.

However, there is a deeper story to be aware of: lottery scammers seem to have the greatest success conning senior citizens who may not be fully mentally capable of protecting themselves or understanding they're being scammed.

Studies show that senior citizens are more likely to be swindled by all kinds of confidence scams, not just lottery-related ones so, while most people have enough sense to understand that they shouldn't pay a stranger $50,000 for a lottery prize they never bought a ticket for, it's a good idea to check in with your elderly neighbors, relatives and friends to ensure that no one is duping them out of their life savings.