In my experience, it's quite common to have raffles and similar events rigged.

I've heard of lots of companies that have booths at conferences where they scan your badge for a """chance""" to win some prize. Then they look up each person's credentials, and if someone is high up in a company that they wish to establish communications with, they give that person a prize to get their foot in the door.

This is just a modern version of the fishbowl of business cards. You put out the bowl and say drop in your card to win “x”. Then when it’s time to do the drawing you look through the cards to see who’s the most advantageous person to establish contact with.

Huh. I never realized that's what those were for.

The whole point of badge scans/fishbowls is to collect leads. That said, especially at larger companies, legal departments are likely to be unhappy if they learn that trade show contests are being rigged.

Perhaps it's time to test that theory and chum the fishbowl waters with a doctored business card too advantageous to pass over.

Pretty clever

The sub-story about the Tesla is an example of one of the "other types of car giveaways" that is actually legitimate—not the telemarketing scam.

That sub story also takes place in a location where the local authorities are very active in finding and squashing scams (Vegas).

Sorry but seeing comments like this about topics I know about, make me question what other falsehoods and inaccuracies I am reading on HN.

The story about the Tesla took place at Four Winds Casino New Buffalo, which is in Michigan, not Las Vegas. Legally speaking, it is a sovereign nation so I would not put much trust in "local authorities" to protect consumers. Further, although Nevada does have a gaming commission, there are still plenty of "scams" and questionable promotional tactics used by companies both inside and outside of the casinos. Time-share sales, for example, are big business in Las Vegas.

The fine print where there actually is a car awarded generally says something like taxes are the responsibility of the winner. In the ones I've seen if you cannot pay the taxes you will be awarded the cash value instead. (I suspect there is a state law in place)

The real contests are generally run by a third party firm that has no interest in the winners. They are payed to pick someone at random and deliver the prize and paperwork.

Kind of like stock options at a startup that actually makes it.

Some of these promotion companies pay a lot of money just to have their cars as part of promotions (and the sweepstakes companies can get into big trouble if their systems are not setup to give away x cars. Most of them are time seeded so someone is guaranteed to win one a week).

If your already investing that much money, can't the company also cover the taxes, or do most states have laws forbidding that? It seems like bad publicity if your "winners" have to pay several thousand in sales tax to get their "prize car."

You're paying income tax, not sales tax, because winnings are income. (Think about professional gamblers...)

Income taxes are progressive, of course, and then there are a mess of deductions. But they could still make an estimate by just assuming the person is in the $37K to $92K bracket. So that's 25% [1].

> It seems like bad publicity if your "winners" have to pay several thousand in sales tax to get their "prize car."

I think they make the judgement that offering a prize that is 3/4ths as expensive would be less good publicity vs. the largely unknown bad publicity that is mostly oriented towards the government anyway.

[1] ... and yeah, there's 25% on that, and 25% on that, etc.; for tax rates < 1 it's convergent, if the tax_paid = rate * (original_value + tax_paid), just solve for tax_paid.

> You're paying income tax, not sales tax, because winnings are income. (Think about professional gamblers...)

Think about them why? Gambling income is in a completely different category from a prize you won for free. There's no reason they have to be taxed the same.

> Gambling income is in a completely different category from a prize you won for free.

The only difference is that as a professional, you're filing your taxes as a business. It's still "income"[1], it's just the entity filing is a business rather than a specific person.

Regardless, a prize you win is not taxed as a sale.

> There's no reason they have to be taxed the same.

To the extent they're treated inconsistently, people will use the discrepancy to game the system. Politicians do that deliberately, of course, since it's an opportunity for graft.

[1]: https://www.investopedia.com/terms/i/income.asp

> The only difference is that as a professional, you're filing your taxes as a business.

In gambling, you're putting money into the system, possibly applying skill, and getting money back out.

With free prizes, you're just being given things with nothing in return.

That's a big difference. And not one that you can effectively game. It's very clear whether you're inputting money or not.

For legit contests, there is usually a small cash prize in addition that covers the cost of sales/gift tax. This was the case back in the 90s through at least Oprah's car giveaway in the early 2000s. Maybe they dont do it anymore?

It never covered income tax though; thats on you.

That example was in Vegas were in casinos they do have legit give aways of cars. I use the term legit a bit loosely, you really can win, but the odds are highly unlikely.