Sweepstakes Advance Fee Scams via Prepaid Cards
Fraudsters running fake sweepstakes direct winners to purchase prepaid debit cards and share the card numbers as payment of fictitious processing and tax fees.
Part of: Sweepstakes Advance-Fee Scams
Last reviewed: 1 June 2026
Prepaid cards have largely replaced money orders as the paper-based scam payment of choice because they combine the anonymity of cash with the speed of electronic transfer. A scammer who obtains a prepaid card number can drain the balance within seconds of receiving it, even before the victim has left the store.
For sweepstakes scams, prepaid cards carry an additional advantage: they are sold at the same retail locations where victims shop daily, reducing the logistical barrier that might otherwise give a victim time to reconsider. The framing — buy a card worth [amount] to cover fees and receive ten times that in prize money — exploits basic optimism bias.
How this scam works on prepaid cards
A phone or mail notification tells the victim they have won a sweepstakes. To trigger the release of their winnings, they must purchase prepaid Visa or Mastercard debit cards in specific denominations and call a number to provide the card details for 'processing.'
The caller often coaches the victim to claim the cards are for personal use if a store cashier asks about the purchase. Some retail staff are trained to query large prepaid card purchases specifically to disrupt this type of scam.
Repeat contact follows: each time the victim calls in with card numbers, a new fee emerges. Some victims have lost substantial sums across dozens of prepaid card purchases before recognising the pattern.
Common red flags
- Sweepstakes prize requires purchasing prepaid cards before winnings are released
- Instructions to tell the cashier the cards are for personal use
- Each prepaid card payment is followed by a request for more
- Specific card brands and denominations are specified by the caller
- The sweepstakes name does not match any verifiable brand or organisation
- Contact arrived unsolicited by phone or mail with no prior entry history
How to protect yourself
- No real sweepstakes requires winners to purchase prepaid cards as fees — this is always fraudulent
- If a store cashier questions your prepaid card purchase, take it as an opportunity to pause and reconsider
- Contact the prepaid card issuer immediately if you have shared card numbers — ask for the balance to be frozen
- Do not be persuaded by investment of prior fees: stopping now is always better than continuing
- File a police report, as this constitutes fraud even if recovery is unlikely
- Report the sweepstakes name and contact details to your consumer protection authority
How to report it
- Contact the prepaid card issuer's fraud line immediately with the card numbers
- File a report with the FTC at reportfraud.ftc.gov
- Report to your national postal inspection service if the contact arrived by mail
Frequently asked questions
I have already sent several prepaid card payments. Should I send one more to get my money back?
No. This is a classic escalating commitment trap — scammers count on the psychological pressure of 'sunk costs' to keep victims paying. There is no prize. Stop all contact immediately, report the scam, and focus on documenting your losses for any potential legal action.