CFTC Launches Initiative to Combat Crypto “Pig Butchering” Scams

The Commodity Futures Trading Commission (CFTC) has announced a significant initiative to address the rising issue of cryptocurrency-related scams, explicitly targeting “pig butchering” schemes. The CFTC’s Office of Customer Outreach and Education (OCEO) is developing new collaborations with multiple organizations, such as the American Bankers Association Foundation and several federal agencies, to address these scams.

This partnership will seek to develop and share materials for identifying pig butchering scams. Some elements of this campaign include producing a fact sheet and an investor alert in collaboration with the United States Securities and Exchange Commission’s Office of Investor Education and Advocacy. These resources are designed to assist the public in recognizing signs of such complex and elaborate fraud schemes.

CFTC Director Highlights New Efforts to Combat Rising Pig Butchering Fraud

Melanie Devoe, the Director of the OCEO, also stressed that such partnerships are valuable because they expand the capacity of the office’s consumer education initiatives. Devoe explained that through coordination with federal and state regulators, consumer protection groups, and others, the CFTC is also trying to ensure that its important message of raising awareness and prevention is dispensed in a manner that will prevent these individuals from being defrauded in the future.

She noted that pig butchering schemes, estimated to cost Americans billions of dollars each year, are on the rise and more complex.

Pig butchering scams, which started being prevalent in the last year, involve scammers grooming their victims and building rapport with them, mainly through social media and other online platforms, to lure them to invest in various scams. The scam is named for the way that swindlers ‘lure’ their victims before they seek to extract money from them.

By creating these new partnerships and educational endeavors, the CFTC hopes to increase the public’s awareness and thus prevent or reduce the occurrence of such fraudulent schemes, thereby making for a safer investment landscape.