One of the roles of the Canadian Marketing Association is to ensure the marketplace is free of fraud. CMA has worked in a number of areas concerning deceptive marketing, and fully supported the 2002 changes to the Competition Act aimed at addressing fraudulent or deceptive marketing practices in promotional contests and sweepstakes. CMA is also a member of the Fraud Prevention Forum, which works to prevent Canadians from becoming victims of fraud by educating them on how to recognize it, report it and stop it.
Most organizations run legitimate sweepstakes that follow regulations set out in the Competition Act. CMA members must conform to the laws in Canada in the use of contests, sweepstakes or prizes in the promotion of goods or services. Additionally, CMA enforces special conditions when promoting sweepstakes or contests to children and teenagers.
There are many reputable companies you can work with. Before buying over the phone, you can check with the Better Business Bureau where the company is located, or your local consumer protection office, to see if the organization you are considering purchasing from is legitimate or if it has had complaints filed against it. Be aware, however, that many questionable prize promotion companies do not stay in one place long enough to establish a track record -- an absence of complaints does not necessarily mean the offer is legitimate.
Remember, your best defense against becoming a victim of fraud is to stay educated and be cautious when making buying decisions. Reading this section is a good start to becoming educated about sweepstakes offers and how to protect yourself and your loved ones from becoming a victim of fraud.
How Can I Recognize a Fraudulent Offer?
A sweepstakes is an advertising or promotional tool by which items of value (prizes) are awarded to participating consumers by chance, with no purchase or "entry fee" required in order to win. They are a particularly effective marketing technique because they get consumers to pay attention to a company's products, causes or services.
Many CMA members use sweepstakes as a regular part of their marketing campaigns and want your experience with their offers to be enjoyable - and they want you to respond. They also want you to understand that you have an equal chance of winning whether or not you order the offered products or services.
Unfortunately, not all games and sweepstakes are fair, so it is important to be alert and know what to look for to avoid becoming a victim of fraud. The following points will help you identify fraudulent activity:
- The deal sounds too good to be true.
- You've won a prize in a contest that you don't recall entering.
- You are asked for money to claim a prize, e.g. to pay for taxes, shipping, or processing. Be skeptical and hang up. Don't let anyone pressure you into buying immediately. Any legitimate organization will agree to mail you information.
- This is the final day for this promotion, so order now.
- The caller offers to come to your home for a free demonstration.
- The caller offers to send someone over to pick up your cheque.
- You are asked for your confidential banking information. Reputable businesses do not require these details unless you are making a purchase and using that specific method of payment.
- You are asked to call a 1-900 number. You receive a piece of mail telling you to call a phone number to collect your prize. Read the fine print carefully. There is always a charge to call a 1-900 number.
- You are asked to send cash or a money order.
- The person calling refers to you by your first name and asks you a lot of personal or lifestyle questions (like how often your grown children visit you). The caller is trying to become your friend and trying to find out if you are lonely and willing to talk.
- You must make a purchase to enter the contest. Remember, no purchase is necessary in order to enter a sweepstakes, and the chances of winning are the same whether you order or not.