In recent years, you’ve probably received a text addressed to someone else, a suspicious friend request claiming to be someone you know, or a direct message from a stranger posing as a model. While these messages are designed to be innocuous, they’ve led to thousands of people’s life savings vanishing into the hands of criminal networks.
“Pig butchering” is the latest high profile social engineering scam, and it’s a particularly complex and potent strategy. By understanding how the scam works and following a few simple tips, you can protect yourself and your business—and stop scammers early on.
What you need to know
- Pig butchering is a more complex type of scam that combines several social engineering techniques to defraud victims.
- The term “pig butchering” is a metaphor for how pigs are first fattened up before being slaughtered.
- Fortunately, there are ways to prevent scammers from gaining access to your finances, including proactive training for yourself and employees.
What is a pig butchering scam?
Pig butchering is an online financial scam in which a scammer creates a fake persona to befriend their target, persuades their target to make a series of fraudulent investments, then disappears with the money. The name is a metaphor for fattening pigs before slaughter.
Pig butchering scams are often carried out not by individual scammers, but by trafficking victims coerced into working for criminal networks. These scammers’ forced involvement makes them highly dedicated to fooling their victims, and operating as groups enables elaborate fraud—such as ‘staff’ who pose as customer support or legal teams.
How pig butchering scams work
Pig butchering is an elaborate fraud that synthesizes many types of prolonged social engineering to deceive diligent people. Here’s how it works.
1. The scammer cold contacts the target using an online persona
The scammer creates a new profile on a messaging app, social media platform, or dating service that consists of stolen photos and names—possibly of someone their target knows. They then send their target an unprompted but benign message from this fake profile.
2. The scammer wins the target’s trust
If the target responds, the scammer starts to develop their persona based on what they learn about the target. Their pretext for continuing the conversation will usually be to pursue friendship or romance, though in some cases the scammer may pose as an authority.
3. The scammer introduces fake investment opportunities
The scammer pivots conversation toward investments, explaining that they’ve had recent success. The scammer doesn’t ask for money—instead, they encourage the target to open their own account with a spoofed (fake) brokerage app or site. These can be highly elaborate, with sophisticated user interfaces that mimic legitimate services.
The target then makes a ‘deposit’ by wiring money from their bank account to a cryptocurrency wallet (often hosted by a legitimate exchange), then transfers that balance to their new brokerage account, which is owned by the scammer.
4. The scammer manipulates the target to invest as much as possible
The fake brokerage app shows favorable yields and returns, which entice the target to deposit more. The scammer may even authorize a withdrawal or two, to solidify the target’s trust in their account.
In conversation, the scammer voices support for the target’s success, and encourages them to make further, larger deposits. If the target instead tries to make further withdrawals, the fake brokerage will prompt them to deposit more money—for example, they may ask for a tax payment or withdrawal fee.
5. The scammer covers their tracks
Eventually, either the scammer has extracted as much money as they can from their target, or the target raises an indefensible issue with their account, such as difficulty making withdrawals. At this point, the scammer deletes their persona and the fake brokerage, and vanishes with the target’s money.
Tips for avoiding pig butchering scams
Recognize these early warning signs
- You receive an unsolicited message from a stranger intended for someone else.
- You receive an unsolicited message from a stranger voicing romantic interest, especially if their profile picture looks like a model.
- A stranger pivots online conversation to investments and/or cryptocurrency, especially if they promise too-good-to-be-true returns and pressure you to invest soon. You should also be suspicious of appeals to fear, urgency, or future stability.
- Someone recommends you an unfamiliar or unregistered trading platform.
Train yourself and your employees to spot social engineering scams
Mandate training for you and all your employees to recognize and avoid social engineering strategies, such as phishing attacks. This training should be completed upon hiring and at least annually thereafter to refresh employees’ instincts and update them on new hacking trends.
Verify new accounts who claim to be friends or family
If you receive a message from a new account claiming to be someone you know, call them or ask them in person whether this is their account. Don’t share any personal information with the account until you’ve verified their identity. Keep your personal accounts private, so scammers can’t peruse them for information to trick you with.
Make sure a financial platform is legitimate before depositing funds
Before using any financial technology platform, verify that it’s legally a financial entity, and search for mentions of it in prominent financial publications. Ask friends and loved ones whether they’re familiar with it.
What to do if you’re being scammed
If you realize you’re the target of a pig butchering scam, immediately block the scammer’s account and don’t pay them anything (or any more). Report the scammer to your bank, local law enforcement, and the FBI’s Internet Crime Complaint Center. Keep any relevant messages, financial records, or documentation—your bank may be able to reverse fraudulent transactions, and law enforcement may be able to track your assets or the scammer’s location.
See how Bluevine helps protect your account from fraud.
