‘Everything is fake’: how global crime gangs are using UK shell companies in multi-million pound Cryptocurrency scams
Investigation reveals more than 150 fake firms, many with ties to China, are targeting people online, breaking their hearts – and emptying their bank accounts
woman meets a man online. They flirt. Then, after a few weeks, they begin imagining a future together. Fast forward a few months and one of them has had their heart broken and been defrauded of their life savings.
It sounds like a classic romance scam, but it isn’t. This is “pig butchering”: a brutal, elaborate and rapidly expanding form of organised crime, often involving criminal syndicates, modern-day slaves and victims around the world.
Since it came to prominence in 2021, the fraud – which involves scammers grooming their victims before stealing huge sums in cryptocurrency – has led to losses of hundreds of millions of pounds and prompted warnings from Interpol and the FBI.
Last month, an inquest heard that one UK victim, a former police officer and father from Wiltshire, took his own life after losing about £100,000 – his entire pension lump sum – in a scam bearing the hallmarks of pig butchering.
Now, an investigation by the Observer and the Bureau of Investigative Journalism has found that global organised crime gangs are using the UK as a virtual base for their operations – systematically exploiting lax company registration laws to carry out fraud on an industrial scale.
Analysis has identified 168 UK companies accused of running fraudulent cryptocurrency or foreign exchange trading schemes, with around half of these likely to be linked to pig-butchering scams.
The crime became widely reported in China around 2019 but has since spread around the world. In 2021, the FBI received complaints relating to crypto romance scams in the US that resulted in $429m in losses.
In the UK, there is no specific data on pig butchering but, nationwide, crypto fraud is rising rapidly. In the year to December 2022, reported losses in all crypto scams rose 72% to more than £329m, according to ActionFraud.