Unpacking 'Pig Butchering' Scams

For the Season 1 finale of the The Herbein Conversation’s Fraud Fighters series, host Debbi Fetter is joined by returning guest Julie Mixtacki to explore a fast-growing and highly manipulative scam known as Pig Butchering.

These scams that often target older adults blend romance and investment fraud and use social media and messaging apps to gain trust before convincing victims to invest in fake cryptocurrency platforms.

Tune in to learn:

• How 'Pig Butchering' scams typically unfold
• Red flags to watch for
• Why seniors are especially at risk
• Actionable tips to stay protected

Listen now to close out Season 1 and prepare yourself for one of today’s most dangerous financial scams. We’ll be back this fall with Season 2 of Fraud Fighters, featuring more expert guests, new topics and additional fraud prevention strategies.

Debbi S. Fetter: Hello everyone, and welcome to another episode of The Herbein Conversation Podcast, where we dive into some of the most pressing issues in today’s workplace. I’m Debbi Fetter, Partner and Managing Director of our firm’s Risk Management practice and host of Fraud Fighters, your go-to series for the latest fraud and cybersecurity tips and trends.

In our previous episode, “Elder Fraud on the Rise: How to Spot & Prevent Scams”, we
covered a wide range of schemes targeting seniors, including an introduction to a
relatively new and disturbing type of fraud called "Pig Butchering".

Today, we’re taking a deeper dive into this complex scam that’s wreaking financial and emotional havoc on victims - particularly amongst our elderly population, who are increasingly being targeted.

Joining me again is Julie Mixtacki, Senior Manager and returning guest to the
podcast. Welcome back, Julie.

Julie Mixtacki: Thanks for having me back, Debbi. I’m glad we’re covering this one in more detail. Pig Butchering scams are gaining momentum fast, and people need to be aware of how they work.

Debbi S. Fetter: Definitely for those hearing this term for the first time, “Pig Butchering” refers to a type of investment scam where fraudsters build trust with victims over time, often through dating apps, social media, or messaging platforms. The goal is to “fatten up”, if you will, the victim emotionally and financially before tricking them into transferring funds into fake investments, usually cryptocurrency.

Julie J. Mixtacki: Exactly. The fraudsters often pose a successful investors or professionals. They take their time, sometimes weeks or even months, grooming the victim with daily contact and flattery. Then they introduce what they claim is a quote unquote, hot investment opportunity. It looks legitimate and they take advantage of their relationship with the victim to draw them in using fake websites, dashboards, showing fake returns, even customer service lines.

Debbi S. Fetter: Legitimate is right. These fraudsters have gotten so good at passing these fakes as the real thing that, according to a 2023 FinCEN (Financial Crimes Enforcement Network) alert, these scams have led to billions in losses in the US alone, and they often involve criminal organizations that operate internationally as well. Even more troubling to me is that some of the perpetrators may themselves be victims of labor trafficking, forced to carry out these schemes.

Julie, with such a troubling situation, let's talk about what people should watch out for. What are the red flags?

Julie J. Mixtacki: Well, there are quite a few, and they're often subtle. But here are some of the most common red flags. 

• Number 1: Unsolicited contact through social media or messaging apps. The scam often begins with a friendly “wrong number” text message from someone who seems eager to strike up a conversation. It feels innocent at first, but quickly becomes personal.
• Number 2: Fast- tracked relationships. These scammers are skilled manipulators. Within days, they may refer to the victim as a soul mate or a future partner. If someone you've just met online starts building an emotional connection very quickly, that's a big warning sign.
• Number 3: The third red flag is talk of financial freedom or exclusive investment opportunities. Once trust is built, the scammer introduces cryptocurrency or forex trading as a “secret” they're letting you in on. They may show screenshots of supposed big returns or link you to a slick looking website.
• Number 4: Pressure to act quickly. You may be told there's a limited time window to invest, or that your “mentor” will only offer help once. These false urgencies are designed to get people to bypass their instincts and due diligence.
• Number 5: Requests to move the conversation off the original platform. Scammers will often try to shift to WhatsApp, telegram or private SMS early on. That makes them harder to track and to report.
• Number 6: Fake platforms and apps. Victims are often guided to download what looks like a legitimate investment app or log into a trading platform where they can see their supposed profits grow. But these are completely fabricated.
• Number 7: Strange payment instructions. Anytime you're asked to convert large sums of money into cryptocurrency, perhaps through a Bitcoin ATM, or to use a wire transfer for an unfamiliar investment, stop and think. These are common tools scammers use because the funds are moved quickly and they're very difficult to trace or to reverse.

And it's important to note that older adults are especially vulnerable here. Many are less familiar with cryptocurrency or evolving scam tactics, and scammers exploit that unfamiliarity along with emotional manipulation to devastating effect.

Debbi S. Fetter: Scary, but excellent points. I'd also add that victims sometimes realize something's wrong when they try to withdraw their profits, and all of a sudden, the platform stops responding, or they're told they owe taxes or fees to get their money out. That's often when they discover the entire thing was a ruse, correct?

Julie J. Mixtacki: Yes. And by then the scammer has usually disappeared or even tried to scam the victim again under a different name. It's a very cruel cycle. It's important to remember that victim’s information, especially when fraud has been successfully perpetrated, is often sold between multiple fraudsters, perpetuating revictimization over and over again. The emotional damage is just as severe as the financial loss.

Debbi S. Fetter: Absolutely. And heartbreaking for our elderly friends. And on that note, let's pivot briefly to what financial institutions and employers should be aware of. I understand that FinCEN's alert also encourages banks to look for larger, unusual crypto purchases, especially from accounts that don't normally engage in those types of transactions.

They also recommend training frontline staff to recognize distressed customers who may be under the influence of a scam, and to establish escalation procedures when something seems off.

If a customer asks for a large sum of cash or to send a large wire out a pattern for their normal activity, it's important for the frontline to ask simple questions regarding the purpose of the transaction. One question can be enough to stop the scam.

Julie J. Mixtacki: Yes. And for families, especially those caring for older adults, having open conversations about online relationships and money is vital. The more we talk about this, the more likely people are to recognize the signs early. 

Debbi S. Fetter: Excellent points. Our listeners can certainly count on us to continue talking about it. But before we wrap up this episode, I'd like to go over a few quick takeaways for audience. 

• Number 1: Be skeptical of unsolicited messages and too good to be true investment promises.
• Number 2: Never send money or crypto to someone you've only met online.
• Number 3: Verify investment platforms independently. Don't trust links or downloads from strangers. And lastly,
• Number 4: If something feels off, talk to someone. Getting a second opinion can help stop fraud in its tracks.

Julie, thank you for joining me again and helping shed light on this disturbing but important topic of “Pig Butchering”.

Julie J. Mixtacki: Thanks for having me, Debbi. I hope this episode helps protect someone out there from becoming the next victim.

Debbi S. Fetter: I couldn't agree more. And to our listeners, stay informed, stay alert and if you missed our first episode on elder fraud, we encourage you to go back and give it a listen. You can find Fraud Fighters episodes on our website, herbein.com, Apple or Spotify.

Thank you again for tuning in, and remember, keep up the fight fraud fighters!