Chinese 'pig butchers' fatten unwary Americans up for slaughter in spreading digital swindle

"We're not talking about what's going on at farms," said Frank Fisher, public affairs specialist at the FBI Albuquerque Field Office. "We're talking about a cryptocurrency investment scam that is sweeping the country."

Published: February 19, 2023 10:48pm

Updated: February 23, 2023 11:40pm

In March of last year, fraud and data security expert Trace Fooshee warned readers that "scampocalypse" was just around the corner. Fooshee's 46-page report described the evolution of digital swindling and the many ways in which individuals and businesses were being conned out of billions of dollars online. 

In the months since Fooshee's report, a new type of online scam, known as "pig butchering," has emerged. The FBI describes "pig butchering" as "a time-tested, heavily scripted, and contact intensive process to fatten up the prey before slaughter." 

A sophisticated attack, "pig butchering" has all the elements of a romance scam but with an investment opportunity twist. In December, Frank Fisher, public affairs specialist at the bureau's Albuquerque Field Office, said: "We're not talking about what's going on at farms. We're talking about a cryptocurrency investment scam that is sweeping the country." In the U.S. alone, this form of scam artistry has resulted in the loss of hundreds of millions of dollars

These attacks are being carried out by Chinese criminals, according to new research carried out by Sophos Group plc, a British based security software and hardware company, and many of the victims are in the United States.  

"Pig butchering" went global during the COVID-19 pandemic, Sophos found, for two reasons: the Chinese Communist Party's (CCP) domestic crackdown on cryptocurrency activities and the financial desperation associated with COVID-related lockdowns and loss of income.  

The perpetrators, according to the Sophos report, have in recent times "moved from targeting people in Chinese-speaking communities to an increasingly larger audience," even managing to pass Apple's supposedly rigorous review process and get their applications onto the Apple iOS App Store. As a result of this success, pig butchering scammers have cast their nets into foreign waters, robbing an increasing number of  victims in Western countries.

The scams first started in China in 2018, and "have historically been tied to Chinese organized crime," according to Sean Gallagher, a senior threat researcher at Sophos and author of the report. But in the years since, "butchering" has gone global. Now, "there are scam operators working out of Cambodia, Myanmar, and other Southeast Asian countries," Gallagher told Just the News, "and lookalike scams are now being run by Nigerian cybercriminals and others."

While the people responsible for the fake applications and the more technical aspects of the scams are Chinese speakers, Gallagher noted, "the people who work up front on these scams (texting and making video and voice calls) are more frequently Malaysian, Vietnamese or Taiwanese citizenswho were in many cases lured by fake job postings and forced to work these scams, though some Chinese citizens have also become involuntary participants."

One of the scams highlighted in the Sophos report was a fake cryptocurrency trading app run by a Cambodia-based Chinese organized crime syndicate. The criminals used the TradingView brand, a legitimate platform for traders and investors, to make the scam look legitimate. 

"Wallets associated with the scam app," according to the report, "had visibly taken in about $500,000 US in cryptocurrency from victims in a one-month period." This scam is still active. 

"Based on the losses we know of and the volume we've seen in associated crypto wallets," Gallagher said, "we can say that victims have lost hundreds of millions of dollars over the last two years, and perhaps more."

There are precautions people can take to protect themselves, said Gallagher, including:

  • Always ignore or block unsolicited texts or messages. If someone, for instance, "approaches you in a dating app or on social media and asks to take the conversation to WhatsApp or Telegram, it's a sure sign that something is amiss." 
  • Be wary of people online promising easy wealth through crypto or other trading apps. 
  • "Never install apps on an iPhone or other device that requires the installation of a mobile device management profile — this is an ad-hoc way of installing apps that many criminals use."

Gallagher believes that "pig butchering" is here to stay, and the only way of defeating this criminal activity is by spreading the word and helping people to identify dangerous red flags.

Unlock unlimited access

  • No Ads Within Stories
  • No Autoplay Videos
  • VIP access to exclusive Just the News newsmaker events hosted by John Solomon and his team.
  • Support the investigative reporting and honest news presentation you've come to enjoy from Just the News.
  • Just the News Spotlight

    Support Just the News