What is a ‘Pig Butchering’ Scam?

Pig Butchering is a term or metaphor that describes a scam perpetrated over a long period of time to steal the victim's money repeatedly via online apps.

Also known as "Killing Pig Plate" or "Sha Zhu Pan," this scam started in China around 2019 and since that time victims have lost millions of dollars worldwide.

Background

This scam was developed by Asian-organized crime group/gangs and initially targeted individuals in China then moved to the United States.

• Scammers are human trafficking victims who are forced to perpetuate this scam for money or other financial opportunities.
• Official training with procedure manuals is used to execute scams.
• It is one of the leading scams reported to the FBI and is still underreported.

List of Common Terms

Investors need to understand the common terms related to Pig Butchering scams in order to protect themselves from being financially victimized.

• Cryptocurrency – A digital currency in which transactions are verified and records maintained by a decentralized system using cryptography, rather than by a centralized authority.
• Dating Apps – An application that enables people to meet for a date and possible lasting relationship (i.e., Tinder, Bumble, eHarmony).
• Emotions – A natural instinctive state of mind deriving from one's circumstances, mood, or relationships with others.
• Encrypted messaging applications – Provide end-to-end encryption for user-to-user text
• messaging. Encrypted messaging prevents anyone from monitoring your text conversations.
• Fake Profiles – A profile where someone is pretending to be something or someone that doesn't exist.
• Fake trading platform – Binary options trading platforms manipulate the trading software to distort binary options prices and payouts. For example, when a customer’s trade is “winning,” the countdown to expiration is extended arbitrarily until the trade becomes a loss.
• Investing scam – Happens when people try to trick you into investing money. A scammer may lie to you or give you fake information about a real investment.
• Love Bombing – The action or practice of lavishing someone with attention or affection, especially to influence or manipulate them.
• Manipulation – To control or play upon by artful, unfair, or insidious means especially to one's own advantage.

The Red Flags

• Out of the blue text message from wrong number.
• Builds a relationship over time.
• Encourages potential victim to start investing in cryptocurrency.
• Quickly switches from one platform to another to avoid detection.

Don’t Be a Victim!

• Have you been using social media apps that you don’t understand?
• Did you give/share your personal or financial information with someone you just met?
• Did you invest with an online app and can’t get your money back?

We are Here to Help!

• Do you think you are a victim of a Pig Butchering scam, financial fraud or investment fraud?
• Act quick, get help and stop any wiring/transferring of money or cryptocurrencies.
• Make detailed notes and keep all documentation relating to the transaction.
• Call your local police, law enforcement office, or the Securities Division to file a report.

For more information on financial education or to contact the Securities Division, visit tn.gov/securities, email securities.1@tn.gov, or call 800-863-9117.

Rachel Carden serves as the Director of Investor Education for the Securities Division of the Tennessee Department of Commerce and Insurance.