Because of the investment angle, these scams often come with the highest reported losses, according to cybercrime statistics, and the consequences can be dire. Victims have reportedly been driven to suicide. — Pixabay
Even now, face to face with his decimated savings, it’s hard to reconcile the five-month relationship he had with a Finnish woman in Florida with the elaborate scam it now clearly was.
It felt different than a typical con – too personal, too involved, too reciprocal.
But really, what’s known as “pig butchering” schemes – where scammers build relationships and trust with victims before tricking them into sham cryptocurrency investments – have become particularly pervasive, with some operations tied to mass scam centers based abroad.
The scheme’s name alludes to a pig being fattened up for slaughter.
For weeks, the victim in this case, a Santa Rosa man in his 70s, and Alexa Achselsson, or so she said, messaged every day after meeting on a niche social media and dating site in April. They talked for hours, sometimes by video chat. At one point she even sent him gifts, an expensive pickleball paddle and clothing. There’d been a planned visit, although it was cancelled last-minute, supposedly because of a family emergency just after she’d arrived at the airport in San Francisco.
“They keep you so engaged everyday I think because they know if they can gain your trust they can get your money,” the man said.
He requested anonymity because he has yet to tell his family what happened and is worried about further exposure of his personal information. He reached out to The Press Democrat to put others on alert.
The woman said she taught pilates and yoga – and would often send pictures from her studio – but she also invested with the help of an aunt who owned a company that predicted cryptocurrency trends. The Santa Rosa man had saved about US$500,000 (RM2mil) for retirement, which he planned to take in the spring, but as the sole provider for his wife and a child, he was worried about how long it would last. It seemed like the perfect opportunity.
Instead, a few months later, he’d drained his savings and taken out tens of thousands more in loans.
After working since the age of 18, now, “I can’t retire,” the man said. “It’s hard not to spiral. I just start thinking, ‘Am I going to have to keep working until I die?’ It just gets really depressing.”
At first, he’d put just a few thousand into a cryptocurrency trading account the woman helped him open. She guided him through some investment decisions, and he watched his profits tick up. She then showed him how to transfer a couple thousand back to his bank account. He was hooked, eventually taking more and more out of his 401(k).
By mid-August, he supposedly had just over US$1mil (RM4mil) in his trading account. But, when he went to withdraw the money he got a message saying he needed to pay roughly US$100,000 (RM405,550) in capital gains tax. As he became increasingly worried and desperate to recoup his cash, the woman convinced him to apply for loans and then an equity line of credit to pay the supposed fees.
Finally, he started to do some of his own digging and got in touch with the Australian company, IC Markets, he thought he was trading with, only to have his worst fears confirmed that he’d been using a spoof website.
A multibillion-dollar industry
“These scams are very, very prevalent right now,” said Amy Nofziger, senior director of victim support for the AARP’s Fraud Watch Network.
The details can vary but they follow a similar playbook, whether it starts with a romantic relationship or online friendship or a seemingly innocent wrong number text out of the blue. Nofziger has seen it happen on LinkedIn where a scammer poses as a university student seeking a mentor. They show victims returns when they start investing, sometimes letting them take out small amounts to lull them into a sense of security. And then, inevitably, there’s some fee or penalty to pay or an account could be frozen and the money lost.
In the course of reporting this story, a Press Democrat reporter received a text message from an unknown number: “Let us have dinner tomorrow. I will be making creamy tomato basil pasta” followed by “I’m so sorry for texting you by mistake!” before an attempt to continue the conversation.
It may seem like a lot of energy and effort, but the fraudsters “are making millions and millions of dollars, so they’ll certainly invest the technology and their time. This is their job,” Nofziger said, and “they will take you for every single cent.”
Because of the investment angle, these scams often come with the highest reported losses, according to cybercrime statistics, and the consequences can be dire. Victims have reportedly been driven to suicide. After being duped into a cryptocurrency scam a former CEO of a small bank in Kansas embezzled US$47mil (RM191.mil) from the financial institution, causing its collapse and devastating local shareholders. He was later sentenced to 24 years in prison, and federal authorities recouped millions in lost funds for victims.
Increasing isolation but 24-7 accessibility through cellphones create the perfect conditions for these scams that have also capitalised on the cryptocurrency craze. They’ve skyrocketed since the pandemic, according to experts.
“A lot of people aren’t where they want to be right now in their lives, and things are expensive,” Nofziger said, “and so when you see you have this potential opportunity to get ahead a little bit, you don’t want to miss out, because you’ve missed out on a lot of other things.”
While the full scale of impact is hard to quantify, one study put losses to pig butchering scams at US$75bil (RM304.2bil) globally between 2020 and 2024. The Federal Bureau of Investigation estimated Americans lost some US$6.5bil (RM26.4bil) to cryptocurrency investment scams, a figure that’s been climbing year over year.
Pig butchering scams have been tied to a rise in crime syndicate-run scam compounds, especially out of South-East Asia where the pandemic emptied out casino towns. Abandoned facilities were refashioned as fraud factories, with workers – often the ones behind those out-of-the-blue texts – victims themselves of forced labour. The United Nations and others have estimated hundreds of thousands are trafficked and trapped.
In October, the U.S. Department of Justice filed what it said was its largest ever forfeiture, seizing roughly US$15bil (RM61bil) in Bitcoin allegedly tied to a pig butchering scheme run out of forced labor scam centers across Cambodia. Last month, the US Attorney Jeanine Ferris Pirro announced a new Scam Center Strike Force to target domestic and international operations.
Resources for scam victims
– Report scams as soon as possible to local law enforcement and, for cyber-related fraud, file a complaint with the FBI’s Internet Crime Complaint Center at www.ic3.gov. Locally, contact National Scam Response Centre at 997.
– Fraud specialists can provide victims with steps to take, guidance through the reporting process and referrals to law enforcement and support groups. They can also provide support to friends or family who suspect a loved one is being victimised.
‘Suffering in silence’
The red flags can seem glaring in hindsight but be easier to miss in the moment, and as victims become deeply entangled, they may want to ignore the signs altogether. The Santa Rosa victim now sees one of the crypto trading website’s ending of “.xyz” as an obvious warning, but everything had moved so quickly. Caught up in it all, he’d also encountered a couple of generic alerts about potential scams as he left a mainstream crypto site for a sham one, but the woman always had an answer. No questions were asked when he applied for the personal loans.
The man has yet to follow through with reporting his experience to law enforcement or federal authorities. It can be overwhelming, especially with a whole different subset of scams targeting people looking to file complaints or recoup their losses. A scammer might even try re-victimising a target once they get wise by calling and posing as someone from the FBI offering help, for example.
He’s started and stopped the process. A help line he’d called had been suspended during the government shutdown. It’s hard not to retreat inward, he said. “I’m so ashamed.”
He found some temporary relief in telling a friend, but “after a while you start feeling all alone again. You’re not going to get the money back. You’re going to be working until the end.”
Even with restitution unlikely, it’s not unheard of, Nofziger said. Reporting is necessary for that chance and to help protect against further fraud like identity theft since victims have often given up personal and financial information.
“I worry about people suffering in silence,” said Nofziger, adding that there are organizations like hers that can provide help and make connections to peer support groups. “Sharing can be a very healing process to get some of that off his chest.
“People do blame themselves, but this crime is no fault of their own. They were a target, and they were exploited by a criminal.” – The Press Democrat, Santa Rosa, Calif./Tribune News Service
Those suffering from problems can reach out to the Mental Health Psychosocial Support Service at 03-2935 9935 or 014-322 3392; Talian Kasih at 15999 or 019-261 5999 on WhatsApp; Jakim’s (Department of Islamic Development Malaysia) family, social and community care centre at 0111-959 8214 on WhatsApp; and Befrienders Kuala Lumpur at 03-7627 2929 or go to befrienders.org.my/centre-in-malaysia for a full list of numbers nationwide and operating hours, or email sam@befrienders.org.my.
