Pig butchering is one of the top consumers scams at the moment. That is according to Visa’s Spring 2024 Edition of its Biannual Threats Report, which highlights that 10% of adults surveyed have been targeted.
Pig butchering involves forcing human trafficking victims to trick other individuals into putting their money into fake crypto investments, before disappearing with the cash. Interpol has highlighted pig butchering as a trend in every continent. There is an urgent need to strengthen data collection and analysis to develop more informed and effective counter strategies, to protect customers from putting their bank accounts in danger by being a victim of these scams.
A perfect storm has led to the formation of pig butchering scams
Silvija Krupena, Director of the Financial Intelligence Unit at RedCompass Labs, has two decades of experience in financial crime prevention. They believe a perfect storm of crypto, advanced technology and human trafficking victims falling through the cracks has led to pig butchering becoming a highly lucrative scam for criminals. She argues we need to focus on education first and that banks need to look more closely at their data and take a more proactive approach to intervene before all is lost.
Krupena said: “A perfect storm has led to the formation of pig butchering scams: a confluence of crypto, advanced technology and vulnerable human trafficking victims falling through the cracks. It has become a hugely lucrative scam with one gang stealing over $100mn from victims in less than two years. The true scale is much worse.
“To tackle this holistically, we need to focus on education first and foremost. Anyone can get scammed, it’s only a matter of scammers using the right script. Banks must also up their game. They need to move away from the typical “box-ticking compliance” culture. Instead, they need to look more closely at their data and take a more proactive approach.
“As this scam is built over time and the initial payments appear to be successful investments, often even allowing the victim to harvest some of their initial gains to build confidence and trust, banks and payment providers have a front-row seat as the fraud begins.
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By GlobalData“By looking for specific red flags in their data and adopting persona-based typologies, banks can spot the behavioural patterns that can be found across multiple individuals and the scammers at these ‘pig butchering’ organisations. While crypto makes it difficult to track, this crime is not entirely devoid of red flags, particularly through banking data. When people start to act differently, banks can notice, intervene and act before all is lost.”