I Won a Prize, but I Have to Pay a Fee. Is It a Scam?

What this helps with: Telling a fake “You won!” call, letter, text, or email from a real prize, and knowing what to do if you already paid.

The short answer: Yes, it’s a scam. Real prizes are free. If you have to pay a fee, taxes, or shipping to get your prize, or give your bank or Social Security number, the FTC says it’s a scam. Hang up or close the message, and don’t pay.

Scammers love the holidays. The FTC warned on Oct 26, 2026, that they are now pretending to be well-known charities. They say you won a sweepstakes because you gave to that charity. Some say they’re from Publishers Clearing House, a lottery, or even the government. Here’s how to tell, and what to do.

Three signs it’s a prize scam

The FTC says these three signs always mean a scam:

1. You have to pay to get the prize. It may be called “taxes,” “shipping and handling,” a “processing fee,” or “customs.” Real prizes are free.
2. You have to pay to raise your odds of winning. Real sweepstakes are free, and winning is by chance. It’s against the law to make you pay to enter or to win more.
3. You have to give your bank account, card number, or Social Security number. There is no reason to give these to claim any prize.

Other things scammers say

• “I’m calling from the government.” They may use a made-up name like “National Sweepstakes Bureau,” or say they’re from the FTC. The government won’t call you asking for money to collect a prize.
• “You won because you donated.” They use the name of a charity you trust, or a name that sounds like it.
• “Your winnings are at the bank. Just pay the fee.” One common story says the money is waiting at the Federal Reserve Bank of New York. It’s not.
• “You won a foreign lottery.” It’s against the law for people in the U.S. to play a foreign lottery. A message like this is almost always a scam.
• “Act now, or you lose it.” Scammers rush you so you don’t stop and think.
• “Here’s a check. Send some back.” The check is fake. Your bank may take weeks to find out, and then you have to pay the money back.
• “Pay with a gift card, a wire, a payment app, cash, or crypto.” Scammers ask for these because the money is hard to get back. See our guide to gift card scams.

Caller ID can be faked. It may show a real company’s name or a real agency’s number. Don’t trust it.

What to do

1. Don’t pay anything. Not a fee, not taxes, not shipping. Not even a small amount.
2. Hang up, or close the message. Don’t press 1. Don’t call back a number they gave you. Don’t tap links in a text or email.
   • What you’ll tap: The red button to end the call. For a text or email, just close it.
3. Don’t share private details. Never give your bank account, card number, Medicare number, or Social Security number.
4. Check it yourself, if you want to. Did you really enter this contest? If you’re not sure, look up the real company or charity’s phone number on its own website or on a bill. Don’t use the number the caller gave you.
5. Search the name online. Type the name of the contest with words like “scam” or “complaint.” Scroll past the ads at the top of the results. Scammers sometimes pay for ads that look real.
6. Report the message.
   • On an iPhone, open the text and tap Report Junk below it, if you see it.
   • On an Android phone, press and hold the text, then tap Block or Report spam. The words can be a little different on each phone.
   • You can also forward a scam text to 7726 (the number spells “SPAM”).

If you already paid or shared something

• I paid with a card or bank account. Call your bank or card company right away. Use the number on the back of your card. Ask them to stop or reverse the charge.
• I paid with a gift card. Call the company that made the gift card right away. Tell them it was a scam. Keep the card and the receipt. Our gift card scam guide has the steps.
• I paid with a wire, a payment app, or crypto. Call the company you used (like Western Union, MoneyGram, Zelle, or the Bitcoin ATM company) right away and ask them to stop it. See our Bitcoin ATM scam guide.
• I gave out my Social Security number. Go to IdentityTheft.gov for a step-by-step plan.
• They keep calling. Don’t answer numbers you don’t know. Paying once often leads to more calls and more “prizes.” Our guide to blocking spam calls can help.
• Someone offers to get my money back for a fee. That is usually a second scam. Don’t pay.
• It’s not your fault. These scams fool careful people. Telling a family member can help.

Where to report it

• Any prize scam: Tell the FTC at ReportFraud.ftc.gov.
• A prize notice that came in the mail: Report it to the U.S. Postal Inspection Service at uspis.gov/report.
• Scams where you lost money online: Report to the FBI at IC3.gov.
• Free help talking it through: Call the AARP Fraud Watch Network Helpline at 877-908-3360. You don’t need to be an AARP member.

Want more ways to spot a fake? See our guides to spotting a scam, checking a charity before you give, and gift card scams.

Official sources

• FTC: Spot scammers impersonating well-known charities and sweepstakes (Oct 26, 2026)
• FTC: Fake prize, sweepstakes, and lottery scams
• FTC: Hang up on PCH impersonators
• U.S. Postal Inspection Service: Report mail fraud
• FTC: Report fraud
• AARP Fraud Watch Network: Helpline

Last checked: Nov 1, 2026

This is general help, not personalized tech support, and not legal or financial advice. It covers U.S. prize and sweepstakes scams. If you think you’ve lost money, contact your bank and the official sources above.