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Banking
Term 038 of 1030
1 min readTwo voicesBanking

Advance-fee scam.

A scam that promises a loan, prize, grant, or windfall but first requires an upfront payment that only enriches the scammer.
Verified July 2026 · Source: FTC
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Advance-fee scam
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In plain English

An advance-fee scam dangles something valuable, a guaranteed loan, a lottery or prize, an inheritance, a grant, or a business deal, but requires you to pay a fee upfront to receive it: taxes, processing, insurance, or a bribe. Once you pay, either nothing arrives or new fees keep appearing to release the promised money. The tell is simple and reliable: legitimate loans, prizes, and grants do not require you to send money first to get money. Real lenders take fees out of the loan, and real prizes do not charge you to claim them.

Most useful ages
18 to 85

01Why it matters

The rule that you should never pay upfront to receive a loan, prize, or windfall defeats an entire family of scams, so holding that single line protects you regardless of how the offer is dressed up.

02The math, step by step

You are told you won a prize or qualified for a guaranteed loan, but first you must pay a fee to release it. After you pay, the money never comes, or more fees appear. Genuine prizes and loans never require paying money first to receive money; that requirement is the scam.

03What this is NOT

Do not confuse with Legitimate upfront costs or deposits

It is not a normal fee. Real lenders deduct costs from the loan rather than demanding cash first, and real prizes cost nothing to claim. A requirement to pay before you can receive a promised sum is the defining mark of the scam.

04Receipts

Every figure on this page is sourced to a primary document. Tap to open the original.

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Last reviewed July 15, 2026 · Reviewer Joseph Citizen, Founder