It appears that we'll have to learn some new cryptocurrency scam jargon. A scamming technique known as “pig butchering” — a reference to how a target is “fattened up” before being butchered or slaughtered — that began in China is now spreading across borders and languages, evolving into a global fraud. In Chinese, it's known as “sha zhu pan”, which translates to “pig butchering” in English. It's essentially a cybercrime including relationship and investment fraud. The offender builds a relationship with the victim over months, frequently romantic but not necessarily, similar to fattening a pig, before enticing them to invest in a fake company and, metaphorically, slaughtering the victim.
According to Global Anti-Scam Organisation, a volunteer-led advocacy group, con artists on dating apps and social media groom targets for weeks to get them interested in investing in cryptocurrency, forex, gold, and other commodities. The scammers do not directly ask for money, instead, they drive victims to a fake investment website or app that they control. The scammers persuade and harass victims into depositing more money into their own “account” inside the fake platform using a variety of ploys in the name of “customer service”. In the end, the victims are not able to withdraw their money.
The Global Anti-Scam Organisation even uploaded a video on YouTube, titled, “What's behind the surge of online relationship-investment frauds today?” The caption states that the scammers “originate from the telecom, online fraud cottage industry in Southeast Asia and are run by Chinese syndicates”. The caption adds that reports of the scam began “surging inside China in mid-2019 and it quickly became a runaway success for the scam industry, which dubbed it “Pig Butchering Plate”.
Watch the video here to understand how the scam works:
A few months ago, one of the victims, a 22-year-old, poured their heart out in a Reddit post to warn others of the scam. “It's a slow scam, they first gain your trust, let you withdraw some funds to feel confident and then slowly take from you until you have nothing left,” wrote the victim in the Reddit post, adding that “these things usually involve romance”. The victim then went on to explain in detail what happened.
Find the complete post here:
According to a report in The Wall Street Journal, the number of romance-scam complaints increased in 2021 compared to 2020, based on consumer reports to the Federal Trade Commission (FTC). The number of romance frauds reported to the FTC increased by approximately 70 per cent from 2020 to 56,000 in 2021. According to FTC data, victims reported losing $547 million in such frauds, a 78 per cent increase from the previous year.
The report also quoted a data researcher with the FTC's Bureau of Consumer Protection, Emma Fletcher, as saying that the COVID-19 may have provided a handy excuse for scammers to say they are unable to meet in person, which may have fostered the continuous expansion of romantic scams.
However, there are a few ways you can stop falling prey to this scam, and other cryptocurrency scams in general.
Exercise caution while making online buddies. Don't believe in financial gimmicks such “steady earnings without loss”, “low investment and huge returns”, etc. Don't be greedy, and resist the temptations of gambling and high-return investments. Don't transfer money to accounts or people you don't know. To avoid slipping into the trap, you should be cautious when transferring money to strangers.
Control all your assets yourself, don't delegate this responsibility to others. Digital assets, as a growing investment market, come with a lot of investment risks. Learn everything about digital assets, and participate sensibly if you wish to reap the rewards.
Beware of phishing. Invest your digital assets in well-known and credit-worthy platforms. The most important thing to remember is to recognise the legitimate platform web URL and to avoid phishing websites that imitate the official exchange platforms.
If people realise they have been duped, they must act quickly to stop the loss. If the scammers contact the victim, their goal should be to gather as much information as possible about the fraudster's identity, location, etc. After that, promptly report to the police.