Pig Butchering: A modern scam that gains your trust, then snatches your money
Investment-related fraud increased by 38% in 2023 to a whopping 4.5 billion dollars, according to the Federal Bureau of Investigation.
Have you ever been approached by a complete stranger on social media or on your mobile phone? It is likely that this could be a scammer. Fraudsters today often approach people directly on digital platforms pretending to have contacted the wrong person erroneously. A typical approach might be to send a message like:
"Hi, it was great meeting you the other day. I had so much fun. Let’s catch up soon!"
Wait!
If you respond to this message, they will continue the conversation to gain insight into your life.
If the victim is someone going through a difficult time, feeling lonely, or desperately seeking human connection, it creates the perfect entry for these types of fraudsters. They use the information revealed by the victims to exploit the victim’s emotional vulnerability and in the process gain the trust and emotional attachment of the victim.
This is only one strategy, these fraudsters can be very creative. In Pig Butchering scams:
- the scammer pretends to be a friendly stranger or romantic partner
- the scammer uses a combination of romance and psychological manipulation to defraud victims
- they often introduces the victim to complex investment schemes or online trading platforms, claiming it will generate excessively high returns
Fact: The term “Pig Butchering” originates from the Chinese phrase “Sha Zhu Pan”.
The metaphor is used to illustrate how the scammer “fattens the pig” or builds credibility with the victim over a lengthy period of time (weeks or even months) by utilizing certain social engineering tricks to ultimately “slaughter the pig” or literally speaking trick the victim into transferring large sums of money to the scammer.
The manipulation tactics used by Fraudsters orchestrating Pig Butchering scams
Scammers may not be the best of human beings, but they are smart. Most scammers have tried and tested their shady ideas, stories, and tactics with a large number of potential victims, therefore, they know what works and what does not in a given context.
The psychological manipulation tactics used by Pig Butchering scammers are specifically aimed at gaining trust or winning the heart of the victim (at least in the first few weeks). So, don’t be surprised if someone who you thought to be an altruistic or highly influential or extremely wealthy individual scams you and runs off with the money.
The strategies Pig Butchering scammers adopt to convince their victims comprise of various methods aimed at gaining the victim’s confidence. For example:
“Check out the article ”Phony” Magazine has written about me and my altruistic actions”
“Check out this ranking, it lists me as one of the wealthiest people in the country”
“I have a friend/cousin who is an expert on financial investments”
“This new trading platform helped me make millions, you should definitely try this. you are in luck as they have a limited-time offer, which saves you a lot of money”
“Look, even Mr. Celebrity uses my services/ or trading platform!”
The above tactics are aimed at building credibility, a sense of urgency or Fear Of Missing Out (FOMO), creating trust and excitement by mentioning that friends and family or even celebrities use their products. These forms of persuasion are aimed at pressurizing the victim to conform to the group’s behavior.
These scammers love to make a great first impression. They do this by creating fake information about themselves and their services, often this is executed through fake testimonials and false market data. For example, they might possess a website or a blog article with people complementing their services or pictures of their extravagant lifestyles or altruistic activities. Moreover, they might share images of significant investment gains they claim to have made from their investing activities.
This information creates a sense of legitimacy which makes the victim believe that they can trust this person since all these other people are saying good things about the person. This form of persuasion can be explained through psychological theories such as the “Halo Effect”, which suggests that the overall impression a person has of someone influences how they feel about their specific personality traits. For example, a person who is well-liked by other people in a particular field may seem like a trustworthy person. This is why advertisers use popular, trusted celebrities to make product recommendations, as it creates a positive halo effect that makes people believe and trust the celebrity’s endorsements.
Moreover, according to theories such as Conformity, it is proven that people tend to adhere to beliefs of groups, even if they themselves may doubt the decision. Therefore, scammers use social proof as a powerful weapon to convince and pressure their victims to make decisions.
Story of Lynn: How a woman lost nearly $1 million in retirement savings
Lynn is a woman who worked hard for 40 years and was about to retire. A person named Vincent contacts her on WeChat via an innocent text message. Over the next few weeks, Vincent builds rapport with Lynn, claiming to be a successful businessman who owns a hotel. Once Lynn begins to trust Vicent, he reveals that he is involved in gold and cryptocurrency investments. As their relationship strengthens, Vincent introduces Lynn to a trading app, which he uses to make investments. The trading app looks highly professional, and Vincent explains that there are lucrative investment opportunities in the market.
Initially, Vincent convinces Lynn to invest a small amount of money, from which she manages to earn a significant return within a relatively short period of time. Lynn, who is motivated by the attractive investment returns she reaped through the App, begins to invest larger and larger amounts of money using her retirement fund.
Vincent urges Lynn to invest more and more, and her investments grow to a considerably large amount. Lynn drains her retirement funds in the process and no longer has any money left to invest. However, Vincent pressures her to take out a loan from the bank and continue investing.
Over time, Vincent’s tone begins to shift, and he eventually stops responding to Lynn. Lynn tries desperately to contact Vincent, hoping to locate her funds, but Vincent has ghosted her completely. Lynn is left emotionally and financially devasted, having lost nearly one million dollars.
The emotional impact of Pig Butchering Scams is severe due to their personal nature. The victim’s reality and beliefs will be shaken, and the financial loss can leave the person feeling betrayed and ashamed. The emotional bonding created by these scams takes time to resolve and heal, therefore, public awareness and support systems are critical to assist the victims who are affected by these scams. Never lend money or invest amounts which you cannot afford to lose on the word of someone you just met online!
Author:
Sasitha Edirisinghe
Aspiring Psychologist. Adv. Dip in Psychology & Counselling.