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FBI warns of spike in ‘pig butchering’ crypto investment schemes
Americans are increasingly targeted in ‘pig butchering’ cryptocurrency investment schemes, according to a public service announcement issued today by the Federal Bureau of Investigation (FBI).
This escalation in attacks has resulted in over $2 billion worth of cryptocurrency lost to cyber criminals, as reported by victims in the U.S. last year.
In cryptocurrency scams, the fraudsters will approach victims via dating platforms, messaging apps, or social media platforms to build trust and introduce them to an investment scheme that will eventually allow them to empty the targets’ crypto wallets.
These scams have become increasingly sophisticated and are using psychological manipulation to lure more and more victims into parting with their money.
“Criminals coach victims through the investment process, show them fake profits, and encourage victims to invest more,” the law enforcement agency said.
“When victims attempt to withdraw their money, they are told they need to pay a fee or taxes. Victims are unable to get their money back, even if they pay the imposed fees or taxes.”
Today’s warning comes after the FBI revealed in its annual Internet Crime Report that Americans lost more than $3 billion to investment fraud in 2022.
“In 2022, investment scam losses were the most (common or dollar amount) scheme reported to the IC3. Investment fraud complaints increased from $1.45 billion in 2021 to $3.31 billion in 2022, which is a 127%,” the FBI said.
“Within those complaints, cryptocurrency investment fraud rose from $907 million in 2021 to $2.57 billion in 2022, an increase of 183%.”
This is not the first warning regarding ‘pig butchering’ schemes issued by the agency. In October, the FBI cautioned of a rise in scams stealing ever-increasing amounts of cryptocurrency from unsuspecting investors.
Previous FBI alerts also warned of scammers using fraudulent investment apps and fake rewards in so-called “play-to-earn” games to steal millions in cryptocurrency from investors.
The FBI also shared today tips on how potential targets can defend themselves against cryptocurrency investment scams:
- If an unknown individual contacts you, do not release any financial or personal identifying information (PII) and do not send any money.
- Do not invest per the advice of someone you meet solely online.
- Confirm the validity of any investment opportunity or cryptocurrency investment website or app.
- If you already invested funds and believe you are a victim of a scheme, do not pay any additional fees or taxes to withdraw your money.
- Do not pay for services that claim to be able to recover lost funds.