“Sweepstakes are causing an enormous drain and hardship for many Iowans.”.
Des Moines. Publishers Clearing House and other companies that use sweepstakes to promote their mail-order products appear to be draining the income of many older Iowans, says Atty. General Tom Miller.
Miller is warning Iowans to be wary of sweepstakes mailings that induce older Iowans to believe – falsely – that they may be close to winning a major sweepstakes prize, and that their chances of winning may go up if they order more merchandise or magazines.
“Hundreds of older Iowans are sending thousands of dollars each to Publishers Clearing House or other sweepstakes promoters in the false belief that they are close to winning a huge prize,” Miller said. “This causes an enormous drain and hardship for elderly Iowans, and a very difficult situation for families and care-givers.”
Miller sounded the warning at a news conference where he was joined by Ken Reif of Eastern Iowa and Mike Heller of Des Moines. Reif’s uncle (age 91) and Heller’s father (84) have spent thousands of dollars each and accumulated piles of books and products sold by sweepstakes promoters.
“Buying magazines or products does NOT increase your chance of winning,” Miller said. “By law, sweepstakes prizes cannot be awarded on the basis of whether you purchase something. In fact, most winners of major PCH prizes did not place an order with their sweepstakes entries.”
Miller also urged Iowans not to believe “personalized” letters that might lead them to believe sweepstakes representatives wanted them to win or they were close to winning. Some mailings show maps to the consumer’s home, or give tips on what to say if a “prize patrol” comes to their door. Some older Iowans have canceled a tripl to be home when the prize patrol might be expected.
“Many Iowans in their 70s, 80s and 90s receive repeated sweepstakes mailings from Publishers Clearing House,” he said. “Many of them have the strong, and wrong, impression that they are close to winning -- and that ordering more magazines or merchandise could make the difference.”
Iowans of advanced age have sent Publishers Clearing House and other sweepstakes operations several thousand dollars in a single year, and, for some Iowans, such payments go on year after year.
Ken Reif’s uncle, Clinton Reif, received 162 sweepstakes mailings from Publishers Clearing House in a two-year period, and he responded by spending more than $4,000 ordering products. Most of the merchandise was stacked, unopened, in his home and garage. Ken Reif showed a home video of his uncle’s garage and house, with piles of solicitations and boxes of products, mostly unopened.
Miller said his office has determined that 2,383 Iowans sent Publishers Clearing House at least $500 last year, and 852 Iowans sent $1,000 or more. Fifty sent more than $3,000 in 2006 – and their average age was 76 years old, according to the Consumer Protection Division.
Miller urged relatives, friends and care-givers to step in if they spotted warning signs that older Iowans may be vulnerable to sweepstakes solicitations:
- The older Iowan receiving numerous sweepstakes solicitation mailings because they are on lists mined by sweepstakes companies.
- The older Iowan receiving a large volume of magazine or other product purchases from a sweepstakes promoter. The items often are given away as gifts or stored unopened or unused.
- The older Iowan having a preoccupation with winning a major prize. For example, calendars may be marked with the date of the next big give-away, or several hours a week may be devoted to responding to sweepstakes mailings.
- The older Iowan having difficulty paying bills or covering expenses. The volume of orders may divert much of a person’s fixed income, or the consumer may ignore a developing financial crisis because he or she is convinced the Prize Patrol will soon deliver a big check.
Miller urged Iowans to contact the Attorney General’s Consumer Protection Division if they discover someone sustaining significant sweepstakes losses – 888-777-4590 (toll-free) or 515-281-5926. The web site is www.IowaAttorneyGeneral.org.
“We certainly can help anyone get off of Publishers Clearing House lists, we can provide advice, and we may be able to help obtain refunds for PCH customers,” Miller said.
He said the office is investigating Publishers Clearing House and looking into sweepstakes more broadly. He said his office would welcome information from Iowans.
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More Background and Details:
Examples of correspondence materials.
Publishers Clearing House – Profile of Iowa “High-Activity Customers”
The Attorney General’s Consumer Protection Division has determined:
- 2,383 Iowans sent Publishers Clearing House $500 or more
- 852 sent $1,000 or more
- 172 sent $2,000 or more
- 50 sent more than $3,000 – and their average age was 76
- 14 sent more than $4,000 – their average age was 79
- 5 Iowans sent more than $5,000 – their average age was 79
- 2,113 Iowans sent Publishers Clearing House $500 or more
- 694 sent $1,000 or more
- 134 sent $2,000 or more
- 33 sent more than $3,000 – and their average age was 72
- 13 sent more than $4,000 – their average age was 74
- 5 Iowans sent more than $5,000 – their average age was 76
Publishers Clearing House – A.G. letter to 844 “High-Activity Customers”
In April 2007, the Consumer Protection Division sent a letter to 844 Iowans who each had sent Publishers Clearing House $1,000 or more in 2006.
- Told the consumer how much he or she had spent in 2006 (top spenders typically do not keep track of total spending).
- Warned of false beliefs that commonly resulted from PCH’s mailings.
- Informed the consumer that most winning sweepstakes entries were sent in without an order.
- Invited the consumer to be removed from PCH’s mailing list by returning a postcard.
So far, 263 Iowa consumers (31%) have returned the postcard and will be removed from PCH’s solicitation list. Those 263 consumers represent 2006 expenditures to PCH totaling $ 432,508.53.
Examples from the Attorney General’s files:
- An older Eastern Iowa man received 162 sweepstakes mailings from Publishers Clearing House in a two-year period, and he responded by spending more than $4,000 ordering products. Most of the merchandise was stacked, unopened, in his home and garage.
- In 2002, a Des Moines man discovered that his 79-year-old father had made a “multitude of purchases” from Publishers Clearing House and Reader’s Digest in pursuit of a sweepstakes prize, taxing a limited income needed for medical bills. Despite efforts at that time to stop the sweepstakes mailings permanently, in 2007 the same man (now 84) was discovered to have become the target again of Publishers Clearing House mailings, which led to another bout of sweepstakes-driven over-spending, much of it for items that were never even opened.
- An 83-year-old Council Bluffs woman recently complained that over the course of nine years of solicitations from Publishers Clearing House she had been led to believe she would win. “I’ve never been so disappointed in my life,” she said. She estimated having spent $7,000 or $8,000 of a modest fixed income in response to the sweepstakes mailings, much of it on products she didn’t want and later tried to return.
- A 100-year-old Cedar Rapids woman believed insinuations that she was going to win the sweepstakes, and eagerly awaited a visit from the Publishers Clearing House “Prize Patrol.” She also responded to a heavy stream of solicitation mailings by ordering more than $6,500 worth of merchandise in 2006. She didn’t want many of the items she ordered, and sold some of them at a substantial loss.
- A 92-year-old Des Moines veteran with a meager fixed income was the target of a large volume of Publishers Clearing House sweepstakes mailings in 2005 and 2006. He became persuaded that he was close to winning, and spent about one-third of his total income on Publishers Clearing House merchandise. Many of his purchases were stacked up, unopened and unused, leaving little space to move around his one-room apartment.