The dating app profile has a picture of a gym flex while the job field only has the elusive “crypto” as an answer.
Although it may sound like the much less luxurious start of Netflix (NFLX) – Get Netflix Inc. Reportits “Tindler Scammers,” online scams are often easier to spot after the fact. While many are exposed, new versions of some crypto scams seem to emerge daily.
The latest scam has a particularly gruesome name and targets people on dating apps and social media platforms. It is known as “pig butchering” or “pig butchering”, in a reference to “fatting up” a victim before the injury.
Authorities have long drawn attention to criminals who use the hype surrounding bitcoin and ethereum’s success to get people to invest in other tokens that turn out to be little more than Ponzi schemes.
Why is it called pig slaughter?
However, the latest scam is more sinister in that it doesn’t rely on shady emails to “buy crypto.” Instead, the scammer finds a person who is already looking for love and friendship and builds trust by conversation over the course of weeks or months.
“The criminal is fattening [the victim] up to slaughter by building trust,” Brent Campbell, CEO of NXS Crypto Fund, told TheStreet in an interview.”[…] They have a script for the college kid and a script for those in their 20s as well as those in their 50s and retirees. They know exactly how to get that person to gain trust over time, and only after a month or two do they say “hey, check out this page or this symbol.”
What follows is almost formulaic in its simplicity – the scammer sends a victim to a website that looks like a crypto startup and gets them to transfer money to a platform that is actually connected to the scammer’s wallet.
Sometimes they will wait a few more months so the person can check their balance and, as it is in the fake “account”, continue to add more. But the result is almost always that the page becomes a broken link while both the scammer and the money disappear.
While it may seem like something to only the most gullible, Campbell said the scammers put a lot of effort into not only building a professional-looking website, but also researching their victims online so they can seem interested in their lives.
Who is a potential victim?
It often works because it specifically targets people who are lonely and specifically looking for either love or socialization.
Often the scammers chat with four or five potential victims at a time; while most will recognize it as a scam and run for the hills, even a transfer of a few thousand will make the dishonest endeavor worth their while.
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“Pig slaughter” is becoming increasingly common. This week, Florida Chief Financial Officer Jimmy Patronis warned state residents about millions being stolen “from unsuspecting investors” in this way.
A Bay Area scammer tricked an accountant into transferring over $1.2 million to a non-existent crypto startup by talking and providing emotional “support” at a time when his father was dying.
With even established cryptocurrencies like bitcoin in downturns and many smaller ones being exposed as scams, some may feel it’s best not to even bother with crypto.
But according to Campbell, there are a number of things one can do to avoid becoming prey if the urge to invest strikes. The most important one is that the interest in investing should come from personal interest and research rather than someone showing up and saying “you have to invest in this!”
“Sometimes it’s as simple as going on Reddit, Twitter (TWTR) – Get Twitter Inc. report or Crypto Twitter and find others saying ‘this is a scam, right?'” Campbell said.
What to do when someone on a dating site starts Hawking Crypto
The other obvious piece of advice is to do all your trading through an established platform like Coinbase (COIN) – Get Coinbase Global Inc Report or Binance where every account and transfer can be tracked.
“If you really want to buy crypto, it’s better to have an exchange where you do everything from one wallet,” Campbell said. “But any talk of finances in the first couple of months should already put you on high alert.”
Other ways to protect yourself include reading up on the company (does it have news articles from major outlets about it?) and evaluating the website (does it have misspellings or a poor interface?).
Since scam sites can look quite professional, another option is to run it through the Wayback Machine to check how long it has been around.
While everyone wants to be the one who “knew about bitcoin”, a new token is a huge red flag – with even major players like bitcoin and ethereum down more than 50% in the year so far, even legitimate smaller cryptocurrencies are burning out in the middle in the current downturn.
But since investing always comes with taking risks, those who are truly interested should at least limit themselves to an amount they are not afraid to lose (say $50 to $100) and take mistakes as a learning opportunity.
“There are a lot of really interesting and value-oriented things going on in crypto that are being masked by all this fraud and crazy stuff going on,” Campbell said. “Basically, you just need to go out with your eyes wide open and use the right security. Don’t transfer $20,000 to a wallet you don’t know how to secure.”