Transnational criminal organizations targeting Americans in complex investment scams,
older Connecticut residents at increased risk.
(MIDDLETOWN CT – March 26, 2024) – According to the FBI’s Internet Crimes
Complaint Center (IC3), cryptocurrency investment fraud grew more than 53% in 2023 to
approximately $4.5 billion. But it may be far worse, as a recent study suggests that the total since
2021 may actually be $75 billion.
What is causing this loss? Law enforcement has identified this scam as “pig butchering.”
In pig butchering investment scams, also known as sha zhu pan (杀猪盘) in Chinese, the
fraudster initially contacts the victim through dating apps, social media, or professional
networking platforms. They build trust with the victim over several weeks or months, often
feigning romantic interest or establishing a friendly rapport. Once the victim is emotionally
invested, the scammer claims to have insider knowledge of a lucrative investment opportunity
such as cryptocurrency, foreign exchange trading, or a new venture, and persuades the victim to
invest.
The scammer may direct the victim to a fraudulent trading platform or app, which
appears to show impressive returns on their investment. Encouraged by these fake profits, the
victim is lured into investing more money. However, when the victim attempts to withdraw their
funds, they discover that the platform is a sham and their money is lost.
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. It is crucial for the
public to be aware of these scams, to be cautious of unsolicited investment advice from online
acquaintances, and to thoroughly research any investment opportunity before committing funds.
Law enforcement notes that many scammers are themselves victims of human trafficking,
forced to endure appalling working and living conditions. This fact does not justify their actions,
but serves as a significant reminder of the pervasiveness and reach of these transnational
organized crime syndicates.

In 2023, the Cryptocurrency Working Group of the Connecticut State Police succeeded in
recovering nearly $4 million in assets for Connecticut victims, though this is a small number in
comparison to the total losses. The State Police continue to collaborate with local, state, and
federal partners, as well as stakeholders from industry, to investigate scams.
Warning Signs to Avoid Being Scammed
To prevent pig butchering investment scams, several common warning signs should raise
red flags for residents:

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 (SEC) or the Commodity Futures Trading Commission (CFTC).
   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. Remember, if an opportunity seems too good to be true, it probably is.

Older adults, particularly those who have accumulated significant savings or have access
to retirement funds, should be extra vigilant when it comes to potential investment opportunities
presented by new acquaintances. 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.
A 2021 study by AARP found over 56% of victims were over the age of 50 years old with
a median loss of $3,000.
Where to Report an Incident
The State Police also warn victims to avoid or carefully scrutinize the use of third-party
cryptocurrency tracing services who require hefty downpayments or a percentage of “recovered”
assets. The companies claim to have the ability to recover stolen cryptocurrency when in fact
they have no legal jurisdiction or authority to freeze or seize assets, only law enforcement does
through the judicial process.
CT 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. We also recommend that a report
be filed at FBI’s www.IC3.gov