Cash prizes were to be awarded as follows:
1st Place: $10,000
2nd Place: $5,000
3rd Place: $2,000
10 Honorary Mentions: $1000
The instructions were very precise as to word length and how to submit the e-mail entry, and actually resembled an actual contest, but a few things would tip off the more experienced contest entrants.
First off, this is a short story contest, and the first place prize is $10,000. The other prizes equal $17,000. Way too much money to be legit!
But what gives me pause is, why did this slime ball try to pull this off? Assuming he was in it for the money, he must have thought he could somehow cash a boatload of $10 checks made out to SFWA. Okay, so he makes a rubber stamp that says SFWA and opens an account as the president of the Society of Fresh Water Aquarium-owners. Still, he must have thought that enough people would send him $10 to make it worth his while.
What this means is that while there aren't enough people reading science fiction short stories to keep more than a dozen paying markets going (and many of them are barely paying) there are enough people writing science fiction to make it worth the risk of going to the slammer to try to pull this scam off.