Each year, Americans lose billions of dollars in travel scams -- they buy tickets for nonexistent flights or pay for a "prize" that consists of a couple of nights at a rundown hotel in a bad part of town.

It can be tough, at first glance, to tell a scam from a great deal. Dramatic discounts offered by legitimate travel services -- such as drastically reduced fares on certain flights -- make some fraudulent offers seem reasonable.

Fortunately, you can avoid most travel scams by learning to recognize the telltale signs. Here are some red flags to look for:

  • You are "specially selected" to win a prize. If you haven't entered a contest, then the trip you have won is probably fraudulent.
  • The company requires that you wait an unusually long time before taking the trip or receiving the prize. Be suspicious of any company that requires you to wait at least 60 days before taking your trip. Most scam victims pay with a credit card; the companies know that federal law gives you only 60 days, after you get your bill, to dispute a credit card charge.
  • The company pressure you to buy or make an immediate decision. A company offering a genuine bargain should not convey a sense of urgency. Walk away from high-pressure sales calls or presentations that do not give you time to comparison shop.
  • The company asks for personal information. Legitimate businesses do not need your income, social security number or bank account number -- and scam artists have many ways to use this information to their benefit.
  • The company gives vague references to "all major airlines" or "all major hotels". Fraudulent vacation certificates typically omit the dates for travel, names of service providers or price of the vacation. If a hotel is listed, contact it directly and ask whether it honors the certificates; the answer will probably be no.
  • You must call a "900" number. Most travel solicitations that require you to respond by calling a 900 number (it's not toll-free and could be very costly) are scams.
  • The company requests a direct bank deposit or certified check, or offers to send a courier to your home to pick up your check. don't agree to pay by certified check or to have your payment picked up by a courier. Scam operators use private courier services and bank drafts in order to avoid prosecution in federal court. That's because federal agencies investigate travel fraud conducted via the post office or telephone, but not these type of transactions.