Ever heard of a “pig butchering scam?”
The Office of Kansas Securities is asking residents to be mindful of an investment scam designed to build trust as part of a series of smaller frauds before a final fraud wipes out all investment gains.
Kansas Insurance Department Public Affairs Manager Kyle Strathman says scammers use texts or messaging apps to find potential victims, frequently using an “unusual explanation” for the contact, before moving into non-investment conversations for the purpose of building trust and gathering information. Phase two is convincing investors to let the scammers do the investments in ostensibly genuine projects — but by using fake brokerage accounts or cryptocurrency businesses. Scammers then produce false investment gains to coerce more money out of the victims before demanding a large amount of money to complete the scam.
The Insurance Department says pig butchering scams are now one of the fastest-growing investment schemes in the country, responsible for over $3.3 billion in reported losses last year.
Kansas Insurance Commissioner Vicki Schmidt says residents need to ignore unsolicited offers and to be wary of anybody giving investment opportunities through text or app — especially if they offer guaranteed or high rates of return.
For more information, go online to insurance.kansas.gov.
