Peggy Staruch got a surprise this month when she discovered that instead of paying $3 for a lottery ticket, playing her lucky numbers has been costing her $6.50 a pop.

“It’s a nasty surprise to see that extra $3.50 charged every time you buy a ticket. You’re paying double . . . you’re better off buying it in the store,” Staruch told the Star.

Staruch bought three lottery tickets online in March and early April, using the new Ontario Lottery and Gaming Corporation website, PlayOLG.ca, which was launched in January.

She said she paid $3 per Lotto 6/49 ticket, using her Royal Bank of Canada VISA credit card. But when she looked at her credit card statement, she saw repeated $3.50 “cash advance fee” charges added on to the original cost of the tickets.

A cash advance typically refers to a person withdrawing cash from an ATM machine on a credit card. Banks usually charge a fee for the service, which can range from $3.50 to $10.

Staruch said she contacted OLG about the $3.50 surcharge, and a customer service representative said it was imposed by her bank. She said an RBC representative then told her OLG was responsible for the fee because the company had set up billing as a cash advance.

She added that when you buy lottery tickets in stores, it’s not billed that way. “(The bank) said that’s how the OLG site has set up its transactions . . . and then OLG of course points it back at the banks,” Staruch said.

“I just would hate to see all these people being surprised. Some people don’t even look at their credit card statements. It’s ridiculous that you’re paying $6.50 for a $3 lottery ticket.”

OLG spokesperson Ryan Bissonnette told the Star that the company does not charge any fees when people buy lottery tickets online, or deposit funds into their online player accounts.

“We clearly state that additional fees could be applied by their financial institutions. That’s something that you can’t miss,” Bissonnette said.

He explained that online customers can use debit cards, Visa or Mastercard credit cards, or Visa debit cards on the PlayOLG website. When someone deposits money into an online account using a credit card, the website includes a warning that “cash advance fees may apply,” he said.

The PlayOLG.ca Terms and Conditions, which players must agree to in order to create an account, also state that “some credit card issuers may treat the funding of a Player Account as a cash advance and charge a fee for each such credit card transaction. Any cash advance fee or other fees relating to the use of a credit card are the Player's sole responsibility.”

“This is not in the fine print. It’s very prominently displayed on our page,” Bissonnette added.

Lena Wan, an RBC communications representative, told the Star that gaming transactions, “such as the purchase of lottery tickets, betting and casino gaming chips,” are considered cash-like transactions.

“As such, these types of transactions are treated as cash advances by some credit card issuers,” she said in an e-mail, urging RBC clients to check with the bank if they are unsure about the status of a purchase.

Caroline Van Hasselt, director of media relations at CIBC, said the bank considers using a credit card for gaming purposes “cash like,” and therefore also bills it as a cash advance.

“If the merchant is classified as a ‘quasi-cash merchant’ like a lottery kiosk and you’re paying with your credit card, it’ll appear as a cash advance on your statement,” she said. “If our client has encountered it for the first time and was surprised, we can reverse the charge.”

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A Toronto Dominion representative also told the Star that the bank classifies transactions at gaming retail merchants as “quasi-cash or cash-like,” which fall under the cash advance category.

Staruch, meanwhile, said she hoped her experience would prevent other online lottery players from being surprised by unexpected charges. “I just want people to know that this exists. I don’t want them to be as surprised as I was.”

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