The Federal Bureau of Investigation (FBI) Miami Field Office, along with the Internet Crime Complaint Center (IC3), has warned about investment schemes involving cryptocurrency called “Pig Butchering.” They noted that individuals have lost from tens of thousands to millions of dollars related to these schemes.
Under the scheme, investors are defrauded by fraudsters who pose as highly successful traders in cryptocurrency. They entice victims to make purported investments in cryptocurrency providing fictitious returns to encourage additional investments.
According to the FBI, the fraudsters make contact with their victims on various social media or dating applications and often spend time gaining the victim’s confidence and trust. These involve either spoofing long lost contacts known to the victim or posing as a potential friend or romantic partner.
The victims are then coached through the investment process and encouraged by the fraudsters to make continuous deposits. The fake websites/apps allow the victims to track their investments and give the impression they are growing exponentially.
Further, when the victims attempt to cash out their investments, they are told they need to pay income taxes or additional fees, causing them to lose additional funds.
The victims are unable to retrieve their purported investments and often lose contact with the fraudsters, either due to the closing of the fraudulent website or the fraudster ceases contact with the victim.
To make the investment, the victims are directed to make wire transfers to overseas accounts or purchase large amounts of prepaid cards. The use of cryptocurrency and cryptocurrency ATMs is also an emerging method of payment.
Source: Read Full Article