Victims lost thousands of dollars to “pig butchering” scam involving crypto

SAN DIEGO (KGTV) — It is an online scam combining friendship and cryptocurrency with money transfers unknowingly made to fraudulent websites controlled by thieves.

Claire, who is only using her first name for privacy reasons, said she first received a random message through WhatsApp from a man who said his name was Louis Wang.

They bonded through various conversations about culture, food and fitness.

“[We were] connecting very fast,” Claire said.

Claire said about a week later, “Louis” introduced her to cryptocurrency and at first, she said she was not interested. However, he continued to gain her trust and coaxed her into it by telling her, “You have to do it. Learning by doing.”

She downloaded two popular cryptocurrency exchanges, which are online platforms where people buy and sell this digital currency. Louis then told her to transfer money to a different online platform that was, unbeknownst to her, controlled by the scammer.

It’s a scam commonly known as “pig butchering.”

“Essentially, what it means is that you fatten up the pig before you then take it to slaughter,” said Eva Velasquez, President and CEO of San Diego-based Identity Theft Resource Center.

It’s not a name she prefers. “The negative way that we talk about victims and victimization can really have an impact.”

The scam had a big impact on Claire. In the end, Claire said she lost roughly $450,000.

“[I] feel ashamed, feel hopeless [and] feel drained,” she said,

The Federal Trade Commission shows crypto scams are booming. From January 2021 to March this year, the FTC recorded thousands of people losing more than $1 billion in scams.

Ethan is another victim. He found his scammer on a dating app called Zoosk.

Similar to Claire, Ethan’s scammer—who said her name was Jenny—gained his trust by talking about things they have in common. She first convinced him to invest small amounts in cryptocurrency, which eventually because thousands of dollars.

At one point, something happened with his so-called account and was told he had to put in even more money to gain access to his funds.

“This is where the gaslighting comes in,” Ethan said. All the pressure comes in to start selling things and get loans. And that’s what she tried to do in the end.”

Ethan said he lost about $560,000 in this scam.

“I went through a divorce and finalized that in January, which of course, I think made me a target for this person,” Ethan said.

Velasquez warned consumers to always be aware of those who build relationships very quickly and then start asking for money.

“The reality is so many of these scammers they’re so good at hijacking our brains,” Velasquez said. “When you’re in that state, those things that are apparent to an outside observer really aren’t apparent to you as the person who’s directly involved in it.”

Claire and Ethan reported the scam to various agencies, including the FBI.

Through all of this, they found support from other victims including each other. They formed a group chat and decided to go public to warn others who may fall for the same trap.

“If I don’t do anything, there are going to be more victims,” Claire said.