DE AG’s Office Issues Cease & Desist Orders in ‘Pig Butchering Scam’

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The Attorney General’s office has issued a cease and desist order against 23 entities and individuals involved in a “pig butchering scam.” The AG’s office describes this as a cryptocurrency scam where victims are groomed over time to make investments using cryptocurrency only to find what they thought what was a safe investment was a scam. The Investor Protection Unit received complaints from Delawareans who were contacted online by unknown persons who urged them to purchase cryptocurrency for investments. The Order prohibits the persons and entities affiliated with the wallets from withdrawing or otherwise moving assets owned by the complainants.

From a release from the AG’s office:

DOJ officials say that after purchasing some crypto and seeing large returns on their initial investments, the victims were encouraged to invest more.  Ultimately, they were never able to withdraw the funds and their cryptocurrency disappeared.  It is estimated that this international scam involves thousands of victims across the country with losses into the billions of dollars. 

“Pig butchering” stems from the scammers’ practice of “fattening” the victims before absconding with their assets (“butchering”).

Working with a data analytics company, the Unit traced cryptocurrency belonging to two Delaware complainants to a number of virtual wallets on various crypto exchanges. The Order prohibits the persons and entities affiliated with the wallets from withdrawing or otherwise moving assets owned by the complainants. This, in turn, prevents the exchanges holding the wallets from permitting parties to move the fraudulently-obtained crypto, thus effectively freezing the accounts holding assets belonging to the Delaware victims.

The Investor Protection Unit offers the following tips for investors:

  1. Be wary of someone you don’t know contacting you through any virtual platform looking to engage in frequent conversations.
  1. Don’t get drawn into online conversations with unknown people who claim to have made a lot of money in cryptocurrency.
  1. Remember that there is no such thing as a risk-free investment. If something sounds too good to be true, it probably is.

Deputy Attorney General Lindsay Nasshorn and Investor Protection Director Jillian Lazar are leading this matter for the DOJ, with support from Deputy Attorneys General Victor Clark and Joey Tabler and Paralegal Harvey Thomas.

If you believe you are a victim of the pig butchering scam or other cryptocurrency investment scam, please file a complaint with the Investor Protection Unit, available at de.gov/investorcomplaint.


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