CT state police warn of ‘pig butchering' investment and romance scams

State police are warning about “pig butchering” investment and romance scams.

They said scammers build the victims’ trust over several weeks or months, then claim to have insider knowledge of a lucrative investment opportunity, which turns out to be a scam.

Citing the FBI’s Internet Crimes Complaint Center, state police said cryptocurrency investment fraud grew more than 53% in 2023 to approximately $4.5 billion, but it might be far worse.

State police said the fraudster initially contacts the victim through dating apps, social media or professional networking platforms and pretends to have a romantic interest or establish a friendly rapport.

Later, the scammer claims they have insider knowledge of a lucrative investment opportunity, such as cryptocurrency, foreign exchange trading or a new venture, and persuades the victim to invest, state police warn.

Then the scammer might direct the victim to a fraudulent trading platform or app, which appears to show impressive returns on their investment.

Then the victim is lured into investing more money but discovers when attempting to withdraw funds that the platform is a sham and their money is lost.

State police said the term “pig butchering” refers to the scammer’s practice of “fattening up” the victim with promises of wealth before “slaughtering” them by stealing their money.

Authorities warn people to be cautious of unsolicited investment advice from online acquaintances and to thoroughly research any investment opportunity before committing funds.

They also said that many scammers are themselves victims of human trafficking and they are “forced to endure appalling working and living conditions.”

The Cryptocurrency Working Group of the Connecticut State Police in 2023 recovered nearly $4 million in assets for Connecticut victims, which is a small number in comparison to the total losses, police said.

State Police said they are collaborating with local, state and federal authorities to investigate scams.

7 warning signs to avoid being scammed

To prevent “pig butchering” investment scams, several common warning signs should raise red flags:

1. Unsolicited contact: Be wary of strangers who reach out unexpectedly through dating apps, social media, or professional networking platforms, especially if they quickly try to move the conversation to Whats App for investing.
2. Too-good-to-be-true returns: If someone promises guaranteed high returns with little to no risk, it is likely a scam. Legitimate investments always carry some level of risk.
3. Pressure to invest quickly: Scammers often create a sense of urgency, claiming that an opportunity is time-sensitive or scarce. Be cautious of anyone who pressures you to make swift investment decisions.
4. Unregistered investments: Before investing, check if the company or individual is registered with regulatory bodies such as the CT Department of Banking, Securities and Exchange Commission or the Commodity Futures Trading Commission. Unregistered entities are a red flag.
5. Lack of transparency: If the person is evasive about their background, the investment details, or the company they represent, this is a warning sign. Legitimate professionals should be transparent and willing to provide verifiable information.
6. Requests for personal information: Be cautious if someone asks for sensitive personal information, such as your Social Security number, bank account details, or copies of your ID, especially early in the relationship.
7. Unusual payment methods: If the person insists on using unconventional payment methods – such as wire transfers, gift cards, or cryptocurrency – this may be a scam.

To prevent falling victim to scams, individuals should thoroughly research any investment opportunity, consult with a trusted financial advisor, and never invest more than they can afford to lose.

Police said older adults, particularly those who have accumulated significant savings or have access to retirement funds, should be extra vigilant about potential investment opportunities presented by new acquaintances.

They said scammers often target older individuals, perceiving them as having more disposable income and potentially being less familiar with online investment platforms or current scam tactics.

The State Police also warn victims to avoid or carefully scrutinize the use of third-party cryptocurrency tracing services who require hefty down payments or a percentage of “recovered” assets. The companies no legal jurisdiction or authority to freeze or seize assets, only law enforcement does through the judicial process, state police said.

Connecticut residents are encouraged to report any suspected incidents of fraud to their local police or State Police barracks. The State Police have also established an email specific to cryptocurrency-related crimes: CSP.virtualcurrency@ct.gov.

They also recommend that a report be filed at FBI’s www.IC3.gov