The Pig Butchering Scam Explained

Reported losses due to investment scams continue to skyrocket.

Did you know in 2023, $4.6 billion was stolen from everyday people like you and me?1 This is up from $3.8 billion in 2022 and $1.7 billion in 2021. Cryptocurrency scams are also one of the top payment methods for losses, with $1.4 billion lost in 2023.

One of the methods criminals use to steal these funds is the pig butchering scam. They trick people into high-yield investments or fraudulent schemes with promises of incredible returns. In this article, we’ll go into how it works, how to avoid the scam, and what you can do if you’ve already been scammed.

What is a Pig Butchering Scam?

A pig butchering scam is when scammers convince people to invest in fraudulent schemes. They start by gaining your trust, then play with your emotions, and finally, they exploit your financial situation with promises of earning high returns on your investment quickly. Here are some of the ways they do it.

How It Works

A lot of work goes into a pig butchering scam, so they can be hard to spot. But here is the most common approach they take:

• Fake personas: The scammer creates a fake online identity. It might be a crypto guru with videos on YouTube or TikTok. Sometimes, it’s a supposed well-known investor. The identities feature images of real people or AI-generated photos.
• Making contact: They will reach out to you on social media or messaging apps. Some pig butchering scams even take place on dating platforms. The scammer will build rapport and ask you about your financial situation. They might attempt to move you to another messaging platform with end-to-end encryption.
• Introducing investment opportunities: As the conversation continues and the scammer builds trust with you, they will share an investment opportunity. They may refer to it as something to invest in together so you can both achieve financial freedom. But to participate, you’ll need to download an unauthorized app or visit a fake investment platform website.
• Encouraging more investments: Once you invest, you’ll start receiving fake reports showing significant returns on your investments. The goal is to encourage you to spend more so you can reach your financial goals faster.
• Ghosting: At some point, the scammer will disappear, and contacting them will be impossible. Your access to the website or app will also be blocked.

Signs of Pig Butchering Scams

While pig butchering scams are sophisticated and tough to spot, there are some red flags that might trigger your spidey sense. These are the ones that I recommend keeping an eye out for:

Unsolicited Messages

This might be harder to spot on dating platforms, but for social media platforms, you should ignore any unsolicited messages or connection requests. This is especially true if they immediately bring up get-rich-quick schemes or investment opportunities.

>> Read More: Online Dating Safety: A Guide to Preventing Romance Scams

Promises of Fast Money

The promise of earning thousands of dollars quickly is something we all wish was true. But most of the time, it’s not. Always do your own research on investments, and don’t believe any reports, images or case studies sent to you by people on the internet you barely know.

An Urgency to Invest

Scammers can’t help themselves and want fast results. They’ll tell you there is a limited time to invest and pressure you not to miss out on these once-in-a-lifetime opportunities. It’s important to stay strong and do your research first to avoid losing your money.

Requests for Your Personal Information

Another method scammers use is promising to invest on your behalf. All you need to do is hand over your address, phone number, Social Security number and other private details. However, they will use this information to steal your identity and take out loans in your name.

Using Unregistered Investment Platforms

If you are told to sign up for an investment platform, check that it is recognized by official regulators like the Federal Reserve or the Securities and Exchange Commission. The scammer will try to direct you to an app or website that they have built. It won’t be secure and will collect your personal and financial information. You’ll also be depositing funds into their accounts.

Complicated Cash-Out Rules

When you ask about how to collect your earnings, there will always be convoluted rules that make it impossible to retrieve your funds. For example, you’ll need to hand over alternative accounts or credit cards instead of using the payment method you used to deposit the money. It’s another tactic to steal more information from you.

Lack of Details of the Investment

The more questions you ask about the investment, the less information you’ll receive. If everything they say is inconsistent or vague, you should end the conversation immediately or fact-check the details you’re given to confirm your gut feeling that this is a pig butchering scam.

Attempts to Separate You From the Group

In group chats, someone will always reach out to you directly. They’ll use private messages for a personal touch and convince you to invest in their scheme. You should always ignore these attempts and leave the group chat.

>> Read More: Staying Safe from Chatbot Scams

How to Avoid Pig Butchering Scams

There are strategies you can use to avoid falling victim to pig butchering scams. If you encounter one of the signs above, this is what you should do:

• Change your social media profiles to private: Check your privacy settings and who can send you connection requests. On some platforms, you can hide your name when people search for it.
• Ignore unsolicited requests to join group chats: If you receive a random request to join a group chat, leave it immediately. You should also be curious about friend requests from strangers and random people sliding into your DMs.
• Report any suspicious activity: If you think someone is trying to scam you, report it to the platform you’re using and law enforcement. Sharing your experience may help other people avoid falling victim to the same scam.
• Don’t share your personal information: Remove the connection or delete the message whenever someone asks for personal details like your bank account, credit card, or Social Security number.
• Stay informed on scammer tactics: Scammers constantly evolve their strategies. They use different forms of manipulation to steal money from you. Stay up to date with the latest scams so you’re always one step ahead.

What to Do if You’re Scammed

Don’t blame yourself if someone has scammed you. There may be options to get your money back and protect your identity to avoid further damage.

Your bank might refund your money. But it’s not guaranteed. It can depend on their policies, how quickly you reported it, and the payment method used. For example, you can stop wire transfers within 30 minutes. But you’ll need to speak to the customer service teams for payment apps like Venmo or PayPal.

If you’ve given the scammer personal information, you should get identity theft protection services. It saves you from constantly checking your bank accounts for unauthorized payments or reviewing your credit score. The best identity theft protection services even include reimbursements of up to $1 million to help cover out-of-pocket expenses related to reclaiming your identity.

>> Learn More: Identity Theft Prevention: Tips and Techniques for 2024

Protect Yourself Online

Pig butchering scams can be devastating, especially for people who are already struggling financially. The promises of fast money can be hard to ignore. But it’s vital you always do your research and validate that the information you’re given is true and accurate before you hand over your cash.

While losing your savings will sting, having your identity stolen can be even worse. Scammers will use your personal information to set up loans in your name and damage your credit. It’s one of the reasons we recommend identity theft protection services to help reduce the risk of losing everything.