Fraudsters make billions of dollars via digital tricks including romance scams and business email hacks. And they always begin with a small amount of "social engineering" to deceive a victim into doing any unfavourable action. These days, a new form of such scams known as "Pig Butchering" is on the rise, which often involve fraudsters contacting targets seemingly at random, then gaining trust before ultimately manipulating their targets into phony investments and disappearing with the funds.
Pig butchering scams originated in China, where they came to be known by the Chinese version of the phrase shāzhūpán because of an approach in which attackers essentially fatten victims up and then take everything they’ve got. These scams are typically cryptocurrency schemes, though they can involve other types of financial trading as well.
They usually involve some type of fake claim or falsified dashboard that shows assets exponentially growing, with the intent being to encourage larger and larger investments.Such scams have grown dramatically in recent years, with individual investors sometimes losing hundreds of thousands of dollars.
Here is how the Pig Slaughtering Scams usually works
A total stranger will approach you and try to establish rapport via text message, social media, or a messaging app. They frequently have web profiles with phoney but convincing-looking images meant to catch your attention and may provide an odd justification for why they're contacting you, such as having spotted your name in their contacts list. They could also give off the impression of trying to establish a sincere friendship or romantic connection.
The fraudster will send you communications about personal, non-investment-related matters over the period of days, weeks, or even months. They may attempt to build trust by providing images, discussing actions such as volunteering to demonstrate excellent character, or giving fake life facts that resemble your own. They may pretend to be a widow, a single parent, or even a member of the military stationed abroad. During the process, the fraudster will also try to acquire information that they may later use to trick you into handing over your money.
Though these scams can present in different ways, inevitably the scammer will at some point steer the conversation toward investment-related topics, often asking whether you have an investment or crypto account.
Though carrying out pig butchering scams requires a significant amount of communication and relationship building with victims over time, researchers claim that crime syndicates in China developed scripts and playbooks that allowed them to offload the work at scale onto inexperienced scammers or even forced labourers who are victims of human trafficking.
How to avoid these Scams?
Government representatives and researchers stress the need of public education in assisting individuals in not falling prey to a pig butchering scam. People are less prone to fall for scams if they are aware of the warning indicators and comprehend the underlying ideas. They claim that the difficulty is in reaching a larger audience and encouraging those who learn about pig slaughtering to spread the word to others in their families and social networks.
Watch for Warning Signs
To avoid becoming a victim of a pig butchering-type scam, watch for these red flags and know how to protect yourself:
Sudden contact: Never react to unwanted communications from unknown contacts, even if they appear to be about unimportant issues, especially through text messages or encrypted messaging apps.
Refusal to join in video chats: If someone you've been talking with frequently declines to communicate in person, they're probably not the person in the profile photo.
Financial information request: Don't disclose any personal financial information with anyone you've never met in person. Put a stop to the relationship if a new virtual buddy or love connection starts making financial questions.
Invitation to invest in certain financial products: Be skeptical of any unsolicited investing advice or ideas, especially if they come from someone you've only interacted with online, and even if they propose you trade via your own account. Always consider what a source stands to gain by sharing advice with you, as well as if the transaction aligns with your financial objectives and investing plan.
An unknown or puzzling investment opportunity: Examine the goods as well as the person and/or corporation soliciting your investment with care. In addition to a normal search, consider including phrases like "scam" or "fraud" to see what results you get. Consider running suggestions from a third party or an investment expert who has no vested interest in the investment, and determine whether the promoter is a registered investment professional.
Unusual trading platforms: Before moving any money, conduct considerable research, especially in a developing industry like bitcoin, which has hundreds of exchanges and new trading channels that are constantly evolving. Who is in charge of the platform? What security precautions are in place? How do you withdraw funds if necessary? Don't invest your assets there if you don't know the answers to those questions.
Exaggerated claims and heightened emotions: Be wary of any investment that makes bold promises or promises returns that are much greater than typical. Fraudsters will frequently appeal to your emotions by using what they know about you, such as by asking, "Don't you want to have money to send your kids to college?"
A sense of urgency related to an impending news event or a rise in the share price: Keep in mind that insider trading is unlawful and that you should never deal in stock based on important, non-public knowledge.