‘Pig Butchering’ gone widespread: California warns of another 17 crypto scams
The suspension of MetaQuotes products from the Apple Store – the iOS versions of MetaTrader 4 and MetaTrader 5 – were directly tied to the ‘pig butchering’ scams, according to an Apple spokesperson and a Forbes investigation.
The California Department of Financial Protection and Innovation (DFPI) has warned of 17 suspected crypto scams in 16 separate notifications published on December 27 and 28.
- RB Hood,
- Reliable Option Trade,
- Rui Win Capital Group,
- SIMEX,
- Sun Bit Proa,
- Tahoe Digital Exchange,
- TeleTrade Options,
- Tony Alin Trading Firm,
- Hekamenltd,
- Tosal Markets Limited,
- Trade 1960,
- Yong Ying Global Investment Company Limited,
- Unison FX,
- VoyanX.com,
- ZC Exchange
- eth-Wintermute.net
- UniSwap LLC.
The California regulator stated that these companies “appear to be engaged in fraud against California consumers”. As an example of these crypto schemes, we transcribe DFPI’s warning of RB Hood below:
“The California Department of Financial Protection and Innovation (DFPI) has received a complaint from at least one California resident regarding a crypto investment.
The victim met a woman calling herself “Jiang Yingying” on social media and they communicated on WhatsApp, Telegram, and through text messaging. At some point, Jiang convinced him to open a crypto account, so he transferred $500 from his debit card, then transferred the cryptocurrency to a Chinese exchange at first called rbhoodc.com, but later it changed its name to rbhoodz.com, then changed again to rbhoodd.xyz. The victim even got a loan for $13,000 which he also deposited into rbhoodc.com through his Crypto.com account. Jiang kept saying he was making money and should add more capital, so he got another $9,500 loan and wired it to Coinbase. At some point, the victim tried to withdraw some of the money, but Jiang told him he had to pay taxes. The victim then spoke to a customer service agent at the exchange who also told him he had to pay taxes on the money before he could withdraw it. The company operated the websites at https://rbhoodc.com; rbhoodz.com; and rbhoodd.xyz.
This appears to be what is commonly called an “Advance Fee scheme,” which can take many forms, as discussed here: https://www.fbi.gov/scams-and-safety/common-scams-and-crimes/advance-fee-schemes. This also appears to be what’s known as a Romance Scam, which is described here: https://dfpi.ca.gov/2022/05/20/romance-scams-and-crypto-assets-fact-or-fraud/
The DFPI urges consumers to exercise extreme caution before responding to any solicitation offering investment or financial services. To check whether an investment or financial service provider is licensed in California, consumers may contact the Department for questions or inquiries at [email protected] or call toll-free at (866) 275-2677. If a consumer believes a person or company has violated state law or acted improperly regarding a consumer financial product or service, they may file a formal complaint with the DFPI at https://dfpi.ca.gov/file-a-complaint/.”
The DFPI has recently stated that individuals’ losses to such fraudulent brokers and websites range from $2,000 to $1.2 million in certain cases.
Most of these frauds are known as “pig butchering scams”, which involve an individual or group creating a fake identity online to build fake relationships via social media or dating apps. After earning the victim’s trust, they enticing them with investment “opportunities” via a copycat version of a legitimate website.
The suspension of MetaQuotes products from the Apple Store – the iOS versions of MetaTrader 4 and MetaTrader 5 – were directly tied to the ‘pig butchering’ scams, according to an Apple spokesperson and a Forbes investigation.
It seems that Apple decided to suspend MetaQuotes apps even though the had reportedly taken action of its own a couple of months ago. The firm had allegedly made it harder for white-label providers to onboard clients in order to prevent its use by scammers.
