Experts Warn of Growing Threat from Crypto Pig Butchering Scams

News | April 29, 2024 By:

On Monday, April 15, 2024, experts at the OffshoreAlert Conference in Miami warned that pig butchering cryptocurrency scams pose a significant and growing problem. Erin West, a prosecutor from Santa Clara County, California, stressed that these schemes are wreaking havoc on victims while funding large human trafficking operations in Cambodia and Myanmar.

Pig butchering scams involve scammers building trust with victims over social media before convincing them to invest in fraudulent cryptocurrency opportunities with promises of high returns. West explained that Chinese organized crime groups have shifted from operating casinos in Cambodia to running sophisticated pig butchering syndicates employing trafficked workers to message and scam victims.

John Griffin, a professor from the University of Texas, presented research findings that these scams commonly begin with transactions on exchanges like Coinbase before funneling funds through networks on the Ethereum blockchain and exiting through exchanges like Binance and Huobi.

West is leading “Operation Shamrock” to coordinate responses across different sectors. Panelists called on social media platforms, cryptocurrency exchanges, and other entities to take more responsibility in stopping scammers from exploiting their systems.

Benedict Hamilton of Kroll said his firm receives many calls from victims who have lost their life savings and described the challenge of recovering any funds.

The experts agreed that identifying patterns in scam transactions and verifying user information could help curb the growing threats while protecting many victims. Their discussion highlighted the need for a systematic approach involving stakeholders from industries currently involved in or facilitating these lucrative pig butchering schemes.