Four US Citizens Indicted in $80 Million Pig Slaughtering Crypto Scam

Pig Butchering Crypto Scam

Four US citizens have been charged with participating in an illegal scheme that netted them more than $80 million through cryptocurrency investment scams.

The defendants – Lu Zhang, 36, of Alhambra, California; Justin Walker, 31, of Cypress, California; Joseph Wong, 32, Rosemead, California; and Hailong Zhu, 40, Naperville, Illinois – have been charged with conspiracy to commit money laundering, concealment of money laundering and international money laundering.

The US Department of Justice (DoJ), which announced the arrests of both Zhang and Walker in connection with the fraudulent operation, said the quartet opened shell companies and bank accounts to run pig slaughter operations, transferring the ill-gotten funds to domestic and Foreign Affairs. international financial entities.

If convicted, Zhang and Walker face a maximum sentence of 20 years in prison. Their alleged co-conspirators remain at large.

“The total fraud scheme in the related pig slaughter syndicate involved at least 284 transactions and resulted in more than $80 million in victims,” the DoJ said. said. “More than $20 million in victim funds were deposited directly into bank accounts associated with the defendants.”

The enforcement action comes as a Nigerian national named Eze Harrison Arinze was convicted to three years in prison for his role in conducting pig slaughter fraud and defrauding 34 victims in 13 countries, resulting in $592,000 in losses.

At the end of last month, the American DoJ did the same announced the seizure of nearly $9 million worth of Tether traced to cryptocurrency addresses allegedly linked to a Southeast Asia-based organization exploited more than 70 victims via pig slaughterhouse.

Pig slaughter falls under the category of so-called romance investment scams, where people are targeted on dating apps under fictitious identities to gain their trust and trick them into investing their money in apparently legitimate and profitable ventures, which typically have high promising investment returns within a short period of time.

Crypto pig slaughter scams

“After convincing the victim to invest, the scammers collect the money, often using digital payment platforms or cryptocurrencies to make tracking more difficult,” says Trend Micro. said in a report detailing the scam.

“Once they receive a substantial amount of money from their victims, or once the victims try to withdraw money from the account, the scammers will suddenly become unreachable, or the broker platform will have problems transferring money. Scammers may also delete their online presence or create new identities, making it difficult for victims to recover their lost money.”

One of the emerging trends in this area involves the use of group chats, which indicates that cybercriminals are adapting and refining their strategies to make them more effective.

In these cases, potential victims are added to a fake investment chat group under their control. Should the target express interest in investing in cryptocurrencies, the conversation moves to a one-on-one chat, where they are introduced to a fake brokerage platform and persuaded to transfer their funds to the service.

According to the Federal Bureau of Investigation (FBI) Internet Crime Complaint Center (IC3) reportcryptocurrency investment fraud has led to unprecedented losses totaling $2.57 billion in 2022, an increase of 183% from 2021.

“A significant portion of these phone numbers can be traced back to leaked databases containing personal information,” the cybersecurity firm said. “More than half of the numbers added to the fake group chats were found in such databases, suggesting that scammers could use leaked information to find their next victims.”

 

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