By Marcus David
Director of Professional Services
MyChargeBack
In a resounding victory for crypto scam victims in California, Arizona and Idaho, the U.S. Department of Justice has seized $112 million from “pig butchering” crypto scams. Authorities received a warrant to seize six cryptocurrency accounts after probable cause of wire fraud was established.
The largest of these accounts is traced to a suspect in Los Angeles who held $66.4 million in stolen crypto funds. Although the process of convicting those responsible for the crime and returning money to victims is likely to be a lengthy one, the story is an encouraging testament to the successful involvement of authorities in large-scale pig butchering crypto scams.
What Are Pig Butchering Crypto Scams?
If this is the first time you’ve heard the term “pig butchering scams,” you may be puzzled.
However, the analogy makes sense. Although many crypto scams try to catch as many potential victims as possible, others prefer to focus on a few people, most likely, those with a lot of funds.
One example of pig butchering scams are Ponzi schemes in which the scammer creates a veneer of respectability and tries to gain the person’s trust. Once the victim believes they know and trust the scammer, they will keep sending them more money in the guise of depositing money into what they think is a trading account.
Pig butchering scams earn their name from the analogy of a farmer feeding and taking care of his pigs with the aim of slaughtering them someday. Those who run crypto scams view their victims – who they call “clients” – in a similar way to how farmers regard their livestock.
How Big of a Problem Are Pig Butchering Scams?
As with all types of scams, it can be hard to know the exact numbers and how much they are stealing until they get caught. For every pig butchering scam that is nabbed by authorities, there are many more on the loose that are actively stealing money from clients.
Thankfully, authorities are becoming more efficient at tracking down these pig-butchering crypto scams and bringing them to justice.
In January 2023, Europol caught a multinational crypto scam that stole money from victims in Australia, Europe and Canada. The average loss per customer was $122,000. In November 2022, the U.S. Department of Justice seized seven crypto accounts with $10 million. This follows a case in July in which a crypto scam stole $42.7 million from 244 victims.
Who Is at Risk for Pig Butchering Scams?
As we can see by looking at similar cases, fraudsters who run pig butchering scams don’t need a huge amount of victims to steal millions. Instead, pig butchering scammers are selective and tend to target individuals who are willing to invest extra money to save for retirement or grow their nest egg.
In fact, it isn’t just naive people who fall for pig butchering scams. The people who lost thousands or millions to Bernie Madoff’s infamous Ponzi scheme weren’t neophyte investors. They trusted Bernie Madoff because he inspired confidence and was skillful in persuading them that he was an investment wizard who had their best interests at heart.
Pig butchering scammers can meet you on social media or can be recommended by someone you think you trust. In fact, they often use imposters pretending to be relatives to persuade someone to invest. The scammers may allow the victims to withdraw a small amount to build trust before asking them to deposit increasing amounts.
The pig butchering scammer will then show fake returns. The customers will believe that these are real results and actually show that their investment is increasing in value. Therefore, they’ll see no reason to make withdrawals but will invest even more money. They may not notice anything wrong until they finally request a substantial withdrawal. By that point, the pig butchering scam has complete control over the money they deposited. That’s when fund recovery experts can help.
Do You Need Fund Recovery from a Pig Butchering Crypto Scam?
If you have money sitting in an account that has been locked down by a pig butchering scam or if a fake broker won’t let you withdraw your money, don’t go it alone. Instead, seek guidance from fund recovery experts who have the skills and technology to track down your funds and provide you with crypto recovery strategies.
MyChargeBack Is the Right Address for Successful Fund Recovery
If you have lost money to a cryptocurrency scam, seek fund recovery assistance right away. Consult with MyChargeBack experts and get started with your fund recovery claim. We have extensive knowledge and working relationships with regulators and more than 450 law enforcement agencies around the world, as well as solutions that can improve your prospects of getting your funds back.
