Cryptocurrency is rife with scams — we all know this to be true. Everybody’s heard the horror stories: “rug pulls,” “pump and dumps,” the typical “investment” ploy that leaves your bank account high and dry. But there’s a new type of fraud going around and it sounds pretty goddamn weird: it’s called “pig butchering” and you’re definitely going to want to steer clear of it.
Also known by its Chinese translation “Shāzhūpán,” “pig butchering” is a bizarre mashup of a romance scam and an investment scheme — a calculated game of manipulation designed to exploit lonely web users and take them for all they’ve got. The trend originated in Southeast Asia, and the name refers to the way in which hogs are “fattened up” before ultimately being led off to the slaughter. In this case, the pigs (the victims) get “slaughtered” when the fraudsters successfully convince them to invest in a phony cryptocurrency platform, then disappear with their money. Charming stuff, no?
Reports of these scams appear to be growing, too. The FBI has apparently received so many lately that, earlier this year, it put out a PSA warning about them. It also put out another alert earlier this week about fake cryptocurrency exchanges — which is a common feature of the scam.
The most bizarre part of the creepy new trend is the fact that many of the scams are being pushed by Asian crime syndicates, which force droves of trafficked hostages to perpetrate the fraud at the barrel of a gun.
Fortunately, the trend has also been getting a lot of media coverage, as authorities attempt to get the word out. Given the weirdness of this one, we figured we’d do our own little explainer. Here’s a quick look at the crypto scam that you’ll want to avoid at all costs.
Dating Apps, Crypto, and Organised Crime
A “pig butchering” scam has a few basic elements to it. Each individual piece isn’t so different from a lot of other crypto scams, though they do offer a noxious brew when mixed together.
The broad strokes go something like this:
- The scammer targets a victim on a dating app like Tinder, initiating a romantic relationship that’s exclusively online
- Through online chats, a level of trust is established
- Inevitably, the “lover” encourages their target to invest in cryptocurrency, commonly directing them to a fake website or app that is secretly controlled by the scammer
- After the victim has agreed to invest some money in the phony platform, the lover disappears (along with the money) — never to be seen again
One lawsuit, filed by a “butchered” victim, describes the scam vividly: “The offender showers the victim with messages of love and affection to emotionally ‘fatten them up’ – similar to fattening a pig …before enticing the victim to invest in a fake [crypto] company and, metaphorically, slaughtering the victim.” Sounds pretty gross.
Yet the strangest part of “pig butchering” is probably less the run-of-the-mill manipulations being employed and more the horrific criminal organisations behind them. Vice reports that many of these crime rings are based in Laos, Cambodia, Myanmar, and other parts of Southeast Asia, where they run “industrial-scale scam centres” that work around the clock to find new victims. These dark versions of customer service call centres work similarly to corporate offices, except for the fact that all of the employees have been kidnapped and forced to commit fraud via violent coercion. Vice reports:
Propping up the [fraud] industry are thousands of people trapped in a cycle of human trafficking, debt, forced labour, and violence; people from across the region lured by fake job adverts to scam centres in Laos, Myanmar, and Cambodia, where they’re forced to perpetrate the kind of fraud used on Tsai.
Like normal call centres, these employees are given detailed scripts for how to target specific “types” of vulnerable individuals. They are then instructed to cultivate relationships and try to suck their money out of them with crypto-related scams. Survivors of these outfits describe long hours and abusive treatment. Horrific videos have circulated social media (also shared in Vice’s report) that show shackled young men being electroshocked in what are apparently some of these scam compounds.
Widespread Abuse
Meanwhile, the victims of these scams run the gamut — and horror stories abound.
One YouTube user, “Scammedbaby,” explains in a video posted last November how he was targeted by someone he met on Grindr. He met this person not long after going through a breakup: “I had just come out of a relationship that didn’t work out…so I was kind of vulnerable,” he said, in the video. “When I met ‘Carl,’ he said, ‘I’m looking for a boyfriend’ and I said, ‘OK, that’s what I’m looking for too.’”
This mysterious “Carl” wooed his target, telling Scammedbaby that he was a wealthy restaurant owner and that he had made a lot of money by investing in cryptocurrency. Unfortunately, “Carl” turned out to be an entirely fictional character invented to bilk Scammedbaby out of thousands of dollars.
On Reddit, meanwhile, you’ll find similar stories. In April, “u/AcceptableList2472,” reached out to the online community for help — confessing that they had found themselves ensnared in a scam and wanted to figure out how to get out:
I have fallen for a pig butchering scam but the scammer does not know that I know. I am hoping any has any advice on how to get my money back. I am fairly deep in and have sent quite a bit of money. I do not believe my scammer knows I have caught on and I have been speaking with him normally even after I found out.
Has anyone been able to recover their money and have any advice on how to do it?
As with most scams, the best defence is probably to never invest in the first place. Still, if you feel you’ve been the victim of one of these scams, you’re encouraged to report your experience to the FBI at their web portal for complaints and assistance.