Free Vacation Scams

Congrats – you've won an all-expense paid vacation to the Bahamas! It's a dream come true! Or is it? Unfortunately, if you receive a notification that you've landed a free luxury vacation, you've likely been targeted by a scam. Here's what you need to know about free vacation scams and how to protect yourself from falling victim.

How the scams play out

In a free vacation scam, a target gets a letter, email, or text message telling them they've won a sweepstakes for a free vacation. They're asked to pay a fee or tax to process the prize. Alternatively, they may be asked to share their credit card information before claiming their prize. After paying the fee, they'll never hear from the sweepstakes company again.

In another variation of this scam, the target is asked to attend a "short" meeting before claiming their prize. It turns out to be a prolonged and overt sales pitch for a time-share purchase or travel-club membership. There may be vouchers for the promised vacation at the end of the class, but they can only be used for specific dates and require additional fees before the "free" vacation can be redeemed.

Red flags

Look out for these red flags to help you spot a free vacation scam:

You’re told you’ve won a sweepstakes you never entered.
You’re asked to pay a fee or tax before a prize can be processed.
You’re pressured to sign up for a time-share purchase or travel club membership.
You’re asked to share your credit card information to claim a free vacation.

Protect yourself

Never share personal information with an unverified contact.
Never agree to pay a “processing fee” or “tax” to claim a prize.
If a caller insists on payment by gift card or wire transfer, hang up.
Always read the fine print and research before signing up for a time-share or club.

If you’re targeted

If you believe you’ve been targeted by a free vacation scam, there are steps you can take to mitigate the damage.

First, if you've paid the "processing fee" or "tax" with a credit card, dispute the charge as soon as possible. If you've shared your credit card information, cancel the card and consider placing a credit freeze on your name. Finally, let the Federal Trade Commission know about the circulating scam.