Office of the Kansas Securities Commissioner
TOPEKA – You have heard of the Nigerian prince scam, but you probably do not associate the term "pig butchering" with investment fraud.
Like a hog fattened before the slaughter, perpetrators of these scams slowly build trust with their targets before “butchering” them with a final fraud and walking away with the victim’s hard-earned money.
The Office of the Kansas Securities Commissioner, a division of the Kansas Insurance Department, warns that pig butchering scams are one of fastest-growing investment frauds in the United States. According to the FBI's Internet Crimes Complaint Center (IC3), investment fraud, including pig butchering scams, totaled $3.31 billion in reported losses in 2022.
Pig butchering scams typically unfold in stages. Scammers reach out to prospective victims unexpectedly through texts or messaging apps, often with an unusual explanation for contacting them. Fraudsters engage victims in non-investment-related conversations to build trust over time and gather information for manipulation.
Once scammers establish rapport, they gradually shift conversations to investment topics. They convince their victims to let them invest their money in seemingly legitimate ventures, often via phony brokerage accounts or cryptocurrency platforms. As the scam matures, fraudsters pressure victims to deposit larger sums after faking initial investment gains. Once the large deposit is made, the fraud is complete, and the scammer disappears with the money.
“Pig butchering scams are a sophisticated take on the romance scam and are often targeted at those who are more isolated and therefore more vulnerable,” said Kansas Insurance Commissioner Vicki Schmidt. “Protect yourself by ignoring unsolicited offers, and be on alert for anyone offering investment opportunities via text or messaging app.”