Pig butchering – the new name in crypto scams

The term pig butchering has come into use to describe the well-established scamming scheme that involves people being contacted, usually via social media, WhatsApp or dating platforms. 

The scammer aims to establish a relationship over weeks or months with the person they have targeted before then making claims about the vast, quick returns that can be made through bogus cryptocurrency investments. In a typical situation, the victim will be persuaded to make an initial investment to either a crypto exchange or to a wallet, although this is all fake and controlled by the scammer. 

The victim will then see what looks to be huge returns in a very short space of time. They may even have a small percentage of their initial investment returned to them, as those behind the scheme do all they can to convince the victim that the scheme is genuine and is producing gains. This, however, is likely to be followed by a request for a second, usually much larger, investment, which will come with talk about the need to act fast to ensure to ensure that even larger returns are not missed. After this second deposit has been made and the victim asks to withdraw their investment, they will be told either that there are issues with it being withdrawn or that there are taxes or fees which will need to be paid before the withdrawal can be made. 

Regardless of whether this additional fee is paid or not, it is typically at this point that the scammer will distance themselves from the victim and cease communication. They are basically running off with the misappropriated cryptoassets. 

These crypto-related scams are becoming alarmingly common. In 2021, Action Fraud reported £128.4 million had been subject to crypto-related scams. The figure for 2022 so far already stands at £160.7 million, which represents a more than tripling of the £50.3 million total for 2020. While this type of fraud is believed to have originated in China in 2019, where it was known as Sha Zhu Pan, it is clear that this scam – and many others - are becoming increasingly commonplace, both in the UK and worldwide. 

While there are different routes that can be taken to recover funds lost in this way, the nature of crypto transfers makes this a difficult task once the transfer has taken place. The police often lack the resources to adequately trace, locate and return the funds. This means that legal recourse is often the best course of action to recoup any misappropriated funds.