SAN FRANCISCO — Authorities are warning of a high-tech tactic in a common scam in which victims are tricked by perpetrators into investing in fake cryptocurrency accounts.
Online predators target people who own cell phones or laptops and are interested in investing a few hundred dollars or more.
Santa Clara County Deputy District Attorney Erin West said, “We have literally never seen anything like this before, for an international crime of this magnitude.”
Bay Area residents are victims of so-called “pig butchering,” where pigs are figuratively bloated by scammers and then essentially economically slaughtered.
Prosecutors are taking a two-pronged approach to the problem: educating potential victims and tracking down the billions in stolen cryptocurrencies.
As Ben Young (not his real name) tells the story of how he lost his family’s savings and the trust of his wife and high school-age daughter, his fingers search for something to hold on to.
It started with an online message, then a text message from someone who appeared to be a former colleague.
“I was in the middle of caring for my dying father, and this person showed me compassion and compassion,” Young said.
A man in his 50s is the victim of a “pig butchering” cryptocurrency investment scam in the Bay Area.
Young asked to remain anonymous for fear of losing his job in the financial industry.
“It hasn’t been easy to face the guilt that I experience every day,” he said.
The FBI estimates that in the last year alone, sophisticated overseas fraudsters defrauded victims out of more than $3.3 billion, many of whom are too embarrassed to report their losses.
Scammers steal personal information, befriend people through social media platforms, and ultimately convince them to invest in fake cryptocurrency accounts.
“You have to be really wary of people trying to get close to you,” West said.
West and the Leach Task Force lead the fight against high-tech organized crime by sharing with local law enforcement, state agencies, the federal government, and international law enforcement how stolen crypto funds are tracked and recovered. are doing.
“These fraudsters move money too quickly, and we don’t have enough trackers in law enforcement to investigate these cases quickly when needed,” West said.
Young initially invested a few thousand dollars, then deposited $1 million that the couple had saved for their daughter’s college tuition and life savings.
“I was blaming myself and it was scary. I lost confidence and sometimes lost my will to live,” Young said.
West began interviewing victims, including Young, last year. Desperate pleas for help come in daily.
“That doesn’t change. They’re all very different tragic stories,” West said.
West’s team helped Young recoup about 8% of his lifetime savings, or about $100,000. Law enforcement agencies believe that the best way to prevent and minimize fraud is to increase awareness.
“Education is key here because they’re not going to change their tactics. They’re doing the same thing over and over again because they’ve never heard it before,” West said.
That’s also why Young shares his life-altering and life-changing lessons for those who may not be wary of the growing number of online scams.
“At least I can help other victims in dire situations,” Young said.
The coalition of law enforcement officials, including West, initially started with about 100 investigators. In the past year he has increased more than 10x, clearly demonstrating the scope and scale of this latest online plan.
Officials say the best defense is to carefully decide whether accepting an online friend or LinkedIn invitation is really necessary and beneficial.
Most of these scams are based overseas, such as Myanmar and Cambodia, but Chinese criminal organizations are said to be leading the charge.
