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FinCEN Alerts on ‘Pig Butchering’ Virtual Currency Scams: Protecting Americans from Billions in Losses

Fraud, Bribery & CorruptionFinCEN Alerts on 'Pig Butchering' Virtual Currency Scams: Protecting Americans from Billions in Losses

Today, the Financial Crimes Enforcement Network (FinCEN) has issued an alert to draw attention to a widespread virtual currency investment scam known as “pig butchering.” Numerous sources in U.S. law enforcement estimate that victims in the United States have collectively lost billions of dollars to these scams and other fraudulent virtual currency investment schemes.

“Pig butchering” scams are named after the practice of fattening a hog before slaughter. Victims invest in what appears to be legitimate virtual currency investment opportunities, only to be deceived and lose their money. Scammers often refer to victims as “pigs” and employ fictitious identities, the pretense of potential relationships, and intricate narratives to deceive victims into believing they are engaged in trustworthy partnerships before ultimately defrauding them—the “butchering.” These scams are primarily orchestrated by criminal enterprises based in Southeast Asia, which use victims of labor trafficking to reach out to millions of unsuspecting individuals worldwide.

FinCEN’s alert outlines the methodology of the scam, provides indicators of suspicious behavior, financial irregularities, and technical signs to assist financial institutions in identifying and reporting related suspicious activities. It also serves as a reminder to financial institutions of their reporting obligations under the Bank Secrecy Act.

 

By FCCT Editorial Team

Disclaimer: The views expressed in this article are independent views solely of the author(s) expressed in their private capacity.

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