When fraudsters invest time to get as much of your money as possible it’s called “pig butchering”. Just as a farm animal is fattened up before being sold to market, pig butchering scammers take a long-haul approach to get what they want from victims. Find out more about these scams and how to avoid them.
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What is a pig butchering scam?
Pig butchering is an increasingly popular approach for scammers, with many layers. The fraudster’s ultimate goal is to get as much money as possible from their target. In the end, they could scam a victim out of hundreds of thousands of dollars. But the scam doesn’t start with a huge haul. It is a longer-term scam that begins with small, trust building steps.
The scammer starts out by making contact with a victim. This is often by text message or a direct message on social media or a dating app. It may seem like a normal message sent to the wrong person. Perhaps appearing like someone trying to get in touch with a family member or checking in on a friend. In reality, the scammer is hoping you will let down your guard and respond. They will keep up the conversation and try to start a friendly relationship with you.
The scammer may even construct a false persona so that they have an account profile online. Using a collection of photos, they can appear as someone who is living a glamorous, wealthy life. This false identity is created to make it seem like they have become rich by investing.
In these scams, the conversation will not turn to investing right away. Instead, the scammers spend time building a relationship and gaining the victim’s trust. This may go on for weeks or months before the topic of money comes up. The scammer could use what they know about the victim’s life — their financial dreams, hopes and fears — as an entry point to bringing up investing. They may start encouraging the victim to invest in a specific trading platform or buy crypto currency.
Like other scams, a pig butchering scam may start out with the victim providing small amounts and being asked for more money over time. If the victim hesitates about signing up for a trading app or crypto platform, the scammer may offer to take over and invest it for them. The scammer may show some early investment returns that make the victim believe their “investment” is doing really well. In reality no investment has been made. This is all a tactic to get the victim to invest even more money. But there is no investing – any money sent is simply stolen.
In the end, once the scammer has gotten as much money as they can, they disappear. And the victim is left without their money and no way to get it back. The victim may be too ashamed to tell anyone — only 5 to 10% of frauds are reported. And they may have lost their retirement nest egg and need to take on debt to cover expenses.
Watch for these signs of a pig butchering scam:
- Email or text from someone pretending to know you, often appearing as a wrong number or friendly accident.
- Overfriendly ongoing texts or emails.
- Newer online relationship that gradually drifts into talking about investments.
- Sharing of hot tips about stocks or crypto assets.
- Sharing of portfolio details or lifestyle making it seem like person is an investing genius.
- Pressure to invest.
Pig butchering scams often result in pressure to buy cryptocurrency. Learn more about the red flags of crypto fraud and how to avoid becoming a victim.
How are pig butchering scams different from other types of fraud?
Pig butchering scammers take a long-haul approach to get what they want from their victim. The title comes from the way farm animals are well fed for many weeks or months before being sold to market. The fraudster takes the time to build a false relationship with you. They want to slowly gain your trust so that they appear genuine when they turn the conversation to investing.
The investment of time is one of the key differences between this pig butchering and other types of scams. Often, in other scams fraudsters will use high pressure tactics right away. For example, with grandparent scams you are pressured to provide money right away for an emergency. But a pig butchering scammer works very slowly and methodically to gain their victim’s trust.
The scammer may build up to sharing a hot tip about a stock. They might begin by talking generally about the markets, crypto currency, or how they supposedly built their own wealth. This is also a tactic used to encourage their victim to open up about their financial life. This can provide the scammer with more detail to use against them.
Pig butchering scams can resemble an affinity scam but without any in-person contact. Pig butchering scams often start online through messaging, seemingly accidentally. This is different from a typical affinity fraud, where the fraudster joins an existing social group and gains trust by seeming like a member of the group.
Learn how to report fraud. If you think you may have been a victim of investment fraud in Ontario, contact the Ontario Securities Commission at 1-877-785-1555. It’s important to report fraud and may also help stop others from being defrauded.
How can you stay safe from these types of scams?
There are several ways you can protect yourself from long-haul fraudsters, including:
- If you get a message from someone you don’t know, ignore it and delete the message. Don’t worry about being polite.
- Don’t share personal information or information about your financial situation with anyone you don’t know.
- Be suspicious of anyone who asks you to send money online, invest or trade online, without meeting them first.
- Watch out for people who you have only interacted with online who promise you high-reward opportunities.
- Be suspicious of any investing opportunity that promises high returns and low risk. If it seems too good to be true, it probably is.
- Don’t invest on any online platform unless you can verify its authenticity. You could lose some or all of your money.
- Before sending funds, always check the registration of anyone giving you financial advice or trying to sell you an investment.
Learn more about eight common investment scams and how to avoid them.
How can you help your family avoid pig butchering scams?
A simple way to help keep your loved ones safe from frauds and scams is to check in with them regularly. If someone has experienced a recent loss or hardship, their emotional stress may make them even more vulnerable to scammers who appear to be friendly, trustworthy online friends.
If a loved one starts talking about their new friend or boyfriend they met online, it’s a good idea ask them questions. For example, find out how they met, if they’ve ever met in person, and what they’ve been talking about.
The more people know about scams, the better they can protect themselves. Talking about the latest scams at the dinner table or over the phone is a great way to help family members keep their money safe.
Test your radar: try the Scam Spotter.
Summary
Pig butchering is a relatively new term, often used in the context of crypto-related scams. In this scam, the fraudster will take a long-haul approach to build trust and a relationship with their victim. Spot the signs and protect yourself:
- The scam starts with an online message or text, often one that appears to be meant for someone else sent to the victim by mistake.
- The scammer will get to know their victim and slowly pressure them into invest in something, often in crypto assets.
- The scammer may start by encouraging the victim to invest small amounts, then move up to larger and larger amounts of money.
