In News:

In its annual report, the Union Home Ministry has warned the public against getting trapped in organised 'pig-butchering scams'.

Key Highlights:

• What is it?
  • The Pig-Butchering Scam is a sophisticated form of cybercrime in which fraudsters deceive victims into investing in fake online trading platforms. The term "pig-butchering" is derived from the analogy of "fattening up" victims before stealing their money, much like preparing a pig for slaughter.
• How it works:
  • Initial Contact: Scammers typically reach out to victims through social media platforms, dating apps, or deceptive ads on websites like Google and Facebook.
  • Building Trust: Fraudsters create false friendships, using these connections to lure victims into investing in fake online trading apps. Cryptocurrency investments are often involved due to the ambiguity in the crypto market.
  • The Scam: Victims are shown fabricated profits to encourage further investment. However, when they try to withdraw their funds, the money is stolen, and they realize the trading platform was fake.
• Features of the Scam:
  • Use of fraudulent online trading platforms
  • Fabricated blockchain transactions, making fund recovery nearly impossible
  • Reliance on victims’ desire for quick financial gains
  • Linked to money laundering and cyber slavery in some cases
• Origin of the Scam:
  • The scam first appeared in China in 2016, where it was referred to as “sha zhu pan” (translated as "killing pig game").
  • It is a form of Ponzi scheme, wherein organized scammers exploit victims by using fake online identities and offering false investment opportunities.
• How Cybercriminals Lure Victims:
  • The scammer (host) contacts potential victims via social media, dating apps, or deceptive online advertisements.
  • They build trust with the victim, enticing them into exploring online investments and cryptocurrency trading, often capitalizing on the lack of clarity in the crypto space.
  • The victim is then persuaded to invest larger amounts in fake trades, believing they are making real profits.
• How the Scam is Executed:
  • The scammer uses fake online trading platforms to create the illusion of profit.
  • After building the victim’s confidence, the fraudster encourages larger investments.
  • When victims try to withdraw their funds, they realize their money is gone, often with blockchain transactions making it nearly impossible to trace or recover the funds.
• Statistics on Cybercrime in India:
  • In March 2024, the National Cybercrime Threat Analytical Unit recorded over 37,500 complaints related to cybercrime.
  • The highest number of complaints (42%) were associated with WhatsApp (14,746), followed by Telegram (7,651), Instagram (7,152), Facebook (7,051), and YouTube (1,135).
• Union Home Ministry’s Response:
  • The MHA has flagged pig-butchering scams as a global phenomenon that could involve large-scale money laundering and cyber slavery.
  • The Ministry is collaborating with Google for intelligence sharing to flag suspicious digital lending apps and other forms of fraud.
  • The Indian Cyber Crime Coordination Centre is working on capacity building to combat such scams and improve the response to cybercrimes.