Our international litigation team has been seeing a veritable ton of a particularly sinister crypto/forex scam: The “Sha Zhu Pan” (Chinese: 杀猪盘) or, “Butchering the Pig” scam.
The typical email we receive from the victims of this forex or crypto scam is usually something like the below email, which describes a textbook “butchering the pig” scam:
我在交友软件上认识了某人。对方提议将聊天转移到WhatsApp上。随着我们分享生活经历和情感故事，彼此关系逐渐发展加深。一段时间后，这人随口提及自己投资获得的惊人收益，随后向我推介了外汇/加密货币投资机会。
在研究并测试了该投资机会后，我的初始存款获得了丰厚收益，这似乎是合法的，于是我向投资公司追加了资金。对方告知若投入更多资金，我可成为VIP会员并获得更高回报，于是我照做了。
后来，我试图从投资账户中提取资金，但客服代表告知我需缴纳资本利得税[或因当局怀疑账户涉及洗钱而被冻结]。该客服声称只要追加汇款，即可提取本金和收益。于是我又汇入更多资金和加密货币，却依然无法提现。 如今客服代表不再回复我的消息，最初介绍我投资的那位联系人同样失联。我已损失数十万美元，不知该如何是好。
Why is this scam called “Butchering the Pig?”
This scam is called “Butchering the Pig” because targets are engaged daily for several months before large amounts of money are sent to the scammers; in other words, it is like fattening up a pig before the slaughter. The scammers, using a profile of an attractive (usually) Asian man or woman, lead the target (the pig) through carefully scripted conversations. Once the target has sent an initial “investment” deposit, the account will show impressive gains. Sometimes the scammer will allow the target to withdraw a small amount of money to prove its legitimacy. The target is encouraged to send further funds to maximize this investment opportunity. Eventually, the scammers cut off all communication, leaving the target without their money or their “profits.”
What makes this scam so insidious and so successful is that while the amounts stolen usually range between USD$10,000 and $2,000,000+, the sheer number of scams occurring is overwhelming. We recently heard from a prominent lawyer who lost more than $5 million on this scam. He eventually decided not to pursue his claims because he feared the publicity would destroy his legal practice.
Between January and July of 2021, the FBI alone received nearly 2,000 complaints of cryptocurrency-focused Sha Zhu Pan scams and there is little doubt the number is considerably higher. The police in China don’t really care because they have more important things to do and in any event they are not all that fond of Americans and Europeans (the usual victims), especially those of Chinese ethnicity, who seem to make up a good chunk of the victims. The police in the foreign country (usually in North America or Europe) have too many cases and more important things to do and so they usually don’t do anything either.
What can you do if you have been a victim of a “Butchering the Pig” scam?
Despite the backlogs, it is always a good idea to report the scam to law enforcement authorities. In the United States, this is done by filing a complaint with the FBI’s Internet Crime Complaint Center (IC3). Doing this can perhaps help you with your taxes and/or your insurance and it also can help in securing a recovery from the scammers’ bank. Your timing of this reporting is critical and it varies depending on what else you do in trying to recover.
Our law firm’s international litigation team has taken on a number of these cases (we usually have two or three going at any given time), so we know that recovering some or even all of the funds lost (without the make-believe “profits”) is possible. When we get these cases we begin by conducting basic investigatory work to determine whether there is any real shot of recovery. If we are able to track the bank wires or cryptocurrency transfers to a bank account or a crypto exchange in a place with good laws – perhaps Singapore, Australia, or Hong Kong (all of which we have encountered) – we then map out the various things we can do to help our clients take action to try to recover their funds.
Each case is different and each depends on the amount lost and the countries and nationalities involved, along with the current state of the scam. I would love to go into more detail on what we do to recover funds lost to scammers, but the last thing I want to do is tip them off here. Sorry.
Bottom Line: Be careful out there and don’t let this scam happen to you. And if it does happen to you, do not give up on trying to secure a recovery.
