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‘Pig Butchering’ Crypto Investment Scams Caused ‘Massive Losses’ to Victims

Source: Adobe/agnormark

An emerging and rather complex form of investment scam known as “pig butchering”, in which flirtatious strangers convince unsuspecting users to invest in crypto trading platforms who end up seizing funds when victims attempt to withdraw money, allegedly robbed victims of millions of dollars worth of crypto-assets.

The term “hog slaughter” refers to a sophisticated, human-intensive process of using fake profiles on social media platforms and dating sites to trick people into investing in unsuspecting scams.

“The fraud is named after the way scam artists feed their victims promises of romance and wealth before cutting them off and taking all of their money,” said the Federal Bureau of Investigation (FBI) warned in April 2022.

The most prevalent form of hog butcher scam involves promising crypto platforms that offer unprecedented returns in a short period of time, according to a recent report by security news and investigation website KrebsonSecurity.

These scams often start with what appears to be a temperamental text message and are also prevalent on dating sites and apps, according to the report. As soon as the victim responds, she asks him to continue the conversation through the WhatsApp messaging platform.

“People forced to perpetrate these scams have a guide and a script, where if your victim is divorced, say this, or if a single mom says this,” said Erin West, assistant district attorney for Santa Clara County in Northern California. . .

West said there are “horrific stories” of victims who have fallen victim to this scam, ranging from young women at the start of their careers to senior citizens and even people working in the financial services industry.

In the report, Courtney Nolan, a divorced mother of three daughters, was named as one of the victims who lost more than $5 million in such a scam. Nolan said it all started with a direct message on Twitter from a “crypto enthusiast”, who promised to advise her on how to make reliable profits using the leading crypto trading platform.

The scammer asked Nolan to create an account on xtb-market[.]com, a duplicate of the original website that was designed to be similar to the official XTB platform. The site promoted various investment packages, including a “starter plan” that required an upfront payment of $5,250 in exchange for a return of over 15%.

According to the report, she initially made small investments and generated large returns. Nolan said she was even able to withdraw amounts ranging from $10,000 to $30,000 on several occasions.

However, after investing over $4.5 million, she had her account frozen. Nolan then received a tax slip showing that she owed nearly $500,000 in taxes before she could reactivate her account or access her funds. After paying the “tax bill”, his mentor and the whole website disappeared.

In general, a pork butcher scam has four elements. These include social media or dating apps, WhatsApp, no video (scammers will find all sorts of excuses not to video call), and investment chatter, according to the KrebsonSecurity report.

As stated earlier, romance scams have seen a sharp increase in recent years. In May 2021, a South Korean woman drugged a man she met on a smartphone chat app and stole $87,000 in crypto from his phone.
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