FinCEN Issues Pig Butchering Warning

Pig butchering scams involve the scammer gaining the victim's trust, often over time, before tricking them into handing over money.

Pig butchering: get scammed by "friends".

The US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has issued an alert to both the public and financial institutions about so-called "pig butchering" scams, which often involve cryptocurrencies.

What Is A Pig Butchering Scam?

A pig butchering scam is a type of "long con" in which the scammer establishes a relationship with the victim, befriending them and seeking to build trust over a period of time, before trying to get them to send money or invest in dubious financial schemes.

They're called "pig butchering" scams because the scammers compare their victims to pigs, who are "fattened up" over a period of time (trust is gained) before being "slaughtered" (having their funds stolen). Pig butchering is often an organized business that involves teams of scammers, frequently based in Asia.

The scam typically starts with the victim being contacted through a direct message on social media from the perpetrator, who of course uses a fake identity. In the crypto world, this may be someone in the same Discord server. They may want to discuss a financial opportunity right away, though equally it may be some time before they mention this. In other instances it could be a message in WhatsApp or another platform, often asking if the number belongs to someone else; when the recipient engages, the scammer tries to befriend them, and possibly eventually even start an online romance.

Once trust has been established, the scammer will raise the "opportunity" of a lucrative crypto investment, and provide a link to a site to purchase it. The user either sends funds and receives nothing in return, or the site contains malware that compromises their wallet, so they lose everything.

The scam may last a long time. In some cases, the perpetrator will use high-pressure tactics to induce the victim to invest more. Sometimes, if the victim finds their funds are locked in an investment platform recommended by the scammer, they will be told they need to pay additional exit fees, or that losses need to be made up by additional deposits.

How To Avoid Being A Victim

There are several red flags to watch for. Vigilance should prevent you from being the victim of a pig butchering scam.

  • Be skeptical of anyone who contacts you out of the blue, especially if they post a link or offer you an investment opportunity.
  • Check identities carefully. Scammers often copy the names and images from trusted community or team members.
  • Never click on links sent or posted by people you don't know/trust. Discords should ideally be set up to delete or disable most external links.
  • Never connect to a site with your wallet unless you trust it. Always use a burner wallet to interact with new contracts, or an address with minimal funds in it. Keep the majority of your crypto in a separate account, and ideally in cold storage.

Ultimately, these kinds of scams thrive on FOMO and fake trust. Pause before you interact with any site that you've been told offers a great new opportunity. Scammers will use high-pressure tactics to try to get you to move quickly, before you can think about it critically—which should itself be a red flag.

Subscribe to our newsletter and follow us on Twitter.

Great! You’ve successfully signed up.

Welcome back! You've successfully signed in.

You've successfully subscribed to REX Wire.

Success! Check your email for magic link to sign-in.

Success! Your billing info has been updated.

Your billing was not updated.