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Pig Butchering: The crypto scam FBI wants you to know

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The FBI Miami Field Office and the Internet Crime Complaint Center (IC3), on 3rd October 2022, issued a warning on a crypto scam technique called Pig Butchering. A technique where fraudsters pose as successful crypto traders, provide unrealistic returns and lure victims into making investments.

According to the FBI, the fraudsters try to gain the victim’s trust on social media platforms or dating applications, coach them through the investment process, and encourage them to make deposits. They use fake websites/apps where the victims track their investments. In addition, the victims are told to pay income taxes or other fees upon cashing out their assets. However, the fraudsters could close down the sites, and the victims lose contact with them and become unable to retrieve their investments.

Victims could be directed to purchase prepaid cards in large quantities or process wire transfers to cross-border accounts. On payment methods, the FBI said, “the use of cryptocurrency and cryptocurrency ATMs is also an emerging method of payment, and individual losses related to these schemes ranged from tens of thousands to millions of dollars.”

How to recognize and avoid the scheme

FBI identified potential ways of spotting the scheme as thus: 

  • Perform an investment validity verification from strangers or social media platforms. 
  • Look out for impersonating domain names on legitimate financial institutions, mostly cryptocurrency exchanges. Note: wrongly spelled URLs could be fake, slightly different from the legitimate financial institution’s website. For example, bínance.com is not the original URL of the largest crypto exchange.
  • Verify the legitimacy of investment apps before downloading them using them. 
  • Be cautious of unrealistic investment opportunities and get-rich-quick schemes.

FBI urges victims of the Pig Butchering scheme or fraudulent schemes to file a report with the FBI’s Internet Crime Complaint Center at www.ic3.gov. According to the FBI, the file should include how the fraudsters initially contacted you, their identity; name, phone number, address, email address, and username. The victims should add complete transaction details in the file. 

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