Michigan Attorney General Dana Nessel is warning Michiganders about scams involving cryptocurrency as financial products like bitcoin become popular.
For instance, a new scam called “pig butchering” has “highlighted a need for fraud awareness,” according to Nessel’s office in a consumer alert sent to Michigan residents on Monday, Oct. 17.
Nessel’s office also noted a 2021 article from the Wall Street Journal estimates the value of the total cryptocurrency market is more than $2 trillion — an increase from $260 billion about a year ago.
Got a text from the wrong number? It could be an attempt at “pig butchering.”
“Pig butchering” is a crypto scam costing investors millions. It uses romance as a tactic to build trust with the victim and ultimately persuades them to invest their money using a fake cryptocurrency platform, according to the consumer alert.
The name refers to how scammers “feed their victims with promises of romance and riches before cutting them off and taking all their money,” according to the FBI in an April 2022 press release.
And it is becoming increasingly popular. In 2021, $429 million was lost to these types of scams, according to the FBI’s Internet Crime Complaint Center.
But there are ways to protect yourself.
Nessel’s office recommended residents should take time to research any investment being considered and be wary of promises of large, quick returns to avoid “pig butchering.”
“As cryptocurrency popularity grows, so will the prevalence of scams,” Michigan AG Dana Nessel said in a press release. “Bad actors running investment scams are always looking for new ways to target unsuspecting investors. It’s so important to do your research before you invest in anything, including determining how and if you will have the option to transfer digital earnings to your bank.”
(Katy Kildee/kkildee@mdn.net)“Most importantly, do not mix online dating with any investment advice,” the consumer alert read. Meaning, don’t take investment advice from people you meet on Hinge.
Below are additional red flags to look for:
- Strangers sending seemingly innocuous text messages out of the blue.
- Strangers who quickly try to move the conversation to WhatsApp or another social media site.
- People who avoid video-calling with multiple excuses or flatly refuse to initiate any kind of video-calling.
- People who are chit-chatting about their insider investment knowledge.
- The URL of the investment platform doesn’t match the official website of a popular cryptocurrency market or exchange but is “very similar.”
- The investment app generates warnings of being untrusted when launched.
- The investment opportunity sounds “too good to be true.”
If you’ve been impacted by this type of scam, consumer complaints can be filed online with Nessel’s Office. The longer you wait, the harder it is to trace or freeze stolen funds, according to her office.
