“Pig Butcher”: Warning of New Cryptocurrency Scam

A new cryptocurrency scam has cost many Canadians and Americans hundreds of thousands of dollars, the Nova Scotia Securities Commission warned Monday.

• Also Read: Crypto: Ex-FTX boss should be fired immediately

• Also Read: The Vertiginous Fall of Sam Bankman-Fried

The scheme’s modus operandi, known as “pig butchering”, first aims to develop a bond of trust with the victim. The latter is first requested via SMS, email or social networks.

After the relationship goes well, the scammer convinces the victim to invest in cryptocurrency. After some time, he sent her a fake “statement of account” showing impressive profits. This part of the scheme is called “fatting the pig” and aims to convince the victim to invest more money.

When the victim tries to withdraw money from their crypto account, the scammer tells them that they need to pay taxes or fees to complete this transaction, but disappears.

In addition, the scammer can access the victim’s bank details by asking them to install commercial applications that allow them to steal more money from the victim.

Eventually the scam ends with the scammer pretending to be another person and telling her she can get her money back if she pays a fee. “This is what is known as a clawback scam and has rehabilitated the original victim,” the Nova Scotia Securities Commission said in a statement.

In most cases, victims of this type of fraud never get their money back.

“While there are always fraudsters inventing new schemes, these ‘pig butchering’ scams involving cryptocurrency assets have become widespread and claim many victims, with far greater losses. Significant,” said Commission President Paul Radford.

The latter also recalled that since 2021, more than a billion dollars have been lost in this type of scam in North America.

The Nova Scotia Securities Commission adds that the best way to protect yourself from these types of scams is to know how to spot them in order to avoid them.