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Deceptive Prize Notices

Whether it's a vacation, big-ticket item or cash, everyone loves the excitement of winning a prize. While most prize promotions are legitimate, some scam artists cheat consumers out of millions of dollars each year by giving them the false impression they have won a prize but must pay money or incur a cost prior to claiming it. In the end, these fraudsters are only looking for a quick way to access your money.

Whether you've entered a contest or not, it is not uncommon to find prize notices in your mailbox or e-mail. However, under the Competition Act, it is a criminal offence for anyone to send you a prize notice that requires you to pay before you can collect your winnings. The bottom line: If you're told you've won a prize, you shouldn't have to pay.

Canada's Competition Bureau works to promote fraud prevention and informs Canadians about how they can recognize, report and stop fraud. For more information on deceptive prize notices, please visit www.competitionbureau.gc.ca or contact the Competition Bureau through any of the methods listed at the end of this pamphlet.

Deceptive Prize Notices under the Competition Act

Section 53 of the Act is a criminal provision. It prohibits the sending of a notice that gives the recipient the general impression that he or she has won a prize and he or she is asked or given the option to pay money or incur a cost prior to claiming the prize. The provision applies to notices sent by any means, including regular and electronic mail.

It's important to note that it is not an offence if the recipient actually wins the prize and the person who sent the notice disclosed the number and approximate value of the prizes in an adequate and fair manner, distributed the prizes in a timely manner, and selected participants or distributed the prizes randomly or on the basis of the participants' skills.

What Are the Possible Penalties?

Any person convicted on indictment under section 53 of the Act can face fines at the discretion of the court and/or can be imprisoned for up to 14 years.

Any person found guilty under this section on summary conviction can be fined up to $200,000 per count and/or can be imprisoned for up to one year.

What I should know before I enter a contest or claim a prize…

Be cautious of any prize notice you receive for contests you never entered or don't recall entering.
Watch out for notices that require you to call a 1-900 or other long-distance number to claim your prize or receive more information about the prize.
Remember, that if you win you should not have to pay money or incur a cost to collect or find out about your prize.
High-pressured sales that require you to pay for an item immediately may be an indication that you are dealing with a scam.
Make sure that you read all the details about the offer contained in any promotional material very carefully (and remember that the material may be misleading).
Don't assume that you have already won something.
Filling out a ballot could mean that your name might be added to lists that are made available to deceptive and fraudulent marketers.
Be careful in sending money up front since recovering losses from scammers will likely prove to be very difficult, especially in the case of foreign-based scammers.
Avoid revealing bank account or credit card-related information to a business or person that you don't know.

The Competition Bureau is an independent law enforcement agency that contributes to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice.

Headed by the Commissioner of Competition, the Bureau is responsible for the administration and enforcement of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.

For more information: