New Jersey Bureau of Securities orders 3 ‘pig butcher’ frauds to cease and desist

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New Jersey’s Bureau of Securities has ordered three website operators to halt the offering of fraudulent virtual currency investment opportunities to the public.

The three cryptocurrency entities blacklisted by the regulator include Meta Capitals Limited, Cresttrademining Limited, and Forex Market Trade, which the regulator says are engaged in pig-butchering scams. In a statement, the state’s regulator warned citizens to be wary of the version of romance scams “where perpetrators essentially fatten victims up and then swindle them of all their funds.”

The Bureau of Securities noted that the scammer roped in the victims by feigning a romantic interest and urging them to invest in fraudulent schemes. A mark of the pig butchering schemes is that the scammer repeatedly asks for funds to grow the investment or fees to process withdrawals.

“These scammers build up a sense of comradery between them and their victim—all to squeeze every cent they possibly can out of these people with promises of huge returns on investments,” Attorney General Platkin said. “We are working around the clock to protect the victims of these types of scams and to show the scammers our laws still apply in cyberspace.”

The regulator noted that the three blacklisted entities shared similar modus operandi in their schemes. Top of the list was the omission of the identity of the principals, the posting of fake testimonials from investors, and failing to disclose all applicable charges.

Pig butchering scams have increased in the U.S., causing a cumulative loss of nearly $500 million in the last 12 months. On June 3, 2022, Federal Trade Commission (FTC) said that the median individual reported loss stands at $2,600, with the scammers opting to receive payments in BTC, Tether (USDT), and Ethereum (ETH).

According to the FTC’s report, “four out of every ten dollars reported lost to a fraud originating on social media was lost in crypto”—Instagram, Facebook, Whatsapp, and Telegram were listed among the top social media platforms used.

Law enforcement agencies have been issuing public advisories to warn citizens of the dangers of falling victim to the scheme to aid existing enforcement actions.

Always be on guard

New Jersey’s Bureau of Securities disclosed tips for the citizens to stay safe against the marauding scammers. The regulator warned users not to respond to unsolicited messages from strange contacts and avoid sending any funds “solely on the recommendation of a social media relationship.”

A clear sign of a fraudulent investment opportunity is the promise of high returns and the inclusion of a “limited time only” deal, the regulator said. Other telltale signs of scamming include the impersonation of a reputable financial institution and the request for funds to be paid via BTC and other virtual currencies.

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