The Advertising Standards Authority has ordered the Diabetes Research & Wellness Foundation to withdraw a direct mailing that the regulator ruled exaggerated the chances of winning a prize.
The mailshot, which was sent to 11,000 people in October, said on the envelope: "Claim your prize sweepstakes. You have been chosen for priority processing. Final step required. If you fail to respond, Diabetes Research & Wellness Foundation cannot be responsible for loss of any prize money that you might have won in the random drawing. Don’t miss out!"
An enclosed letter said it would be "unthinkable to pass up the chance to win monies that could bring you happiness and make future life easier".
The package also urged people to send donations in return for their entry in the sweepstake.
Brent & Harrow Trading Standards complained to the ASA that the mailshot claimed people had won a prize when they had not, exaggerated the chances of winning and implied recipients were luckier than they were.
The regulator upheld all three claims, according to a ruling published today.
The advertising watchdog said the mailshot "created an overall confusing and ambiguous impression".
It said the wording suggested that giving a donation enhanced the prospects of winning.
Its verdict said: "We concluded that the ad implied that consumers had already won a prize, that they were luckier than they were and exaggerated their chances of winning, and therefore was in breach of the code."
The Hampshire-based charity, which had an income of £5.1m in year to 3 December 2016, said in a statement it was disappointed with the decision but would abide by it and was "keen to work with ASA to review any perceived confusing or ambiguous wording within our communications".
The statement said the charity had run a sweepstakes campaign for 17 years as part of its direct-mail programme. It targeted existing supporters and had awarded prizes of £160,000 since 2001, it added.
"There is no purchase of any product or service required to enter," the statement said. "A donation is not required to enter the draw and making a donation does not increase the chances of winning.
"These facts are stated repeatedly throughout the package. In the interests of fairness and completeness, we believe that it is important to consider the entirety of the wording in the package."
It emerged last year that the charity was one of several that were issued advice letters by the Information Commissioner’s Office after the Daily Mail and The Mail on Sunday newspapers carried out investigations into fundraising practices involving several major charities.