Most victims found investigating officers (IO) and police are not equipped with sufficient knowledge of how the ShaZhuPan (or "Pig Butchering" scam) works. The importance of understanding the Shazhupan (essentially 2 components -- the love scam + investment scam) that makes the scam such a successful formula and emulated by scam organizations worldwide, cannot be overlooked.
A study of the victims' profiles, one can see many are highly educated individuals or professionals. From our US anti-scam counterpart group, we were told the largest crypto investor in Spain, had also become a victim of this scam in August 2021, losing more than USD $2 million. Instead of understanding why these scams succeeded, the victims are often made to feel that they were scammed because of their stupidity. The victims did not pay attention to the anti-scam campaigns ran (if any). If the anti-scam campaign messages have not hit the ground and shown results, perhaps it is because they are ineffective or insufficient? This seeming lack of reflection as a body, often translates to how unprepared these officers are with fighting the latest type of cybercrime (these will be elaborated more in section III below).
From 241 people who fell for Shazhupan. Note that in US only 13.1% of adults have degrees higher than Bachelor's
Ms. Ma, defrauded SGD 628,000, was advised her case has no more leads in a letter dated 17 July 2021, despite that she just filed the police report online on the evening of July 16. She received the letter a week after the report. We are left to guess, was the letter drafted immediately after the reporting, without proper investigation even starting? Was the letter timed to be sent out a week later to make it more believable?
Exhibit 1A: Email confirming Ms Ma lodged report on 16 July 2021
Exhibit 1B: Letter from police to Ms Ma dated 17 July 2021
She was further told by her IO that there is no way to trace her transferred funds, when her IO realized that she transferred via cryptocurrency platforms.
One of our Canadian victim transferred funds through Shakepay and was told that they will cease her account and never use their services again after she informed them that she got scammed.
Is cryptocurrency really untraceable? According to the WSJ Opinion on 21 June 2021, titled Intraceable Bitcoin Is a Myth:
“Actually, no. Bitcoin is anonymous, but it’s far from private—an important but often overlooked distinction. The Justice Department recovered more than $1 billion in bitcoin in various investigations during 2020 alone………...That arises when criminals need to spend their bitcoin or convert it into conventional currency. The final transaction deanonymizes the participant and usually triggers the jurisdiction of one or more government agencies. Thus, once criminals transfer their coins into an exchange wallet—even one that doesn’t adhere to the exchange’s Know Your Customer/Anti-Money-Laundering requirement—investigators have what they need to freeze and ultimately claim those assets.”
A report updated on 25 August 2021 by Coindesk, showed how the US government worked with the crypto operator Tether Ltd, to trace and track down the stolen funds.
“The U.S. government is pursuing a civil forfeiture claim on more than 300,000 units of the tether (USDT) cryptocurrency after they were reported stolen in a hack earlier this year.”
The above clearly shows that cryptocurrency is traceable with proper expertise and the help of the crypto platforms. With the most government's several investment arms announcing the foray and focus into the crypto world, if our anti-crime intelligence stays in such a backward stage, we are being exposed to unprecedented high financial risks without any securities or preemptive measure as individuals, institutions or as a nation.
One of our victims, Mr. Nguyen (mentioned earlier), despite reporting his scam on 26 August (less than 12 hours after his last major transfer), did not even hear from his IO after more than 1 week, despite calling and emailing daily to check status if the funds were intercepted successfully or any update. With the victim being traumatized on discovery of being scammed, it will help if the IO can at least assure the victim his case is being followed or looked into.
SINGAPORE - From the data chart below, if we add up the investment scam and the internet romance scams (since Shazhupan scam is made up of these 2 components), it is made up of 50.9% (S$102.6 mil of S$201.2mil) of the total scammed in 2020. This trend is confirmed by a CNA report on 8 July 2021, that cybercrime made up 43% of overall crime in 2020 [8]. “This trend is attributed to the rapid growth of e-commerce, the proliferation of community marketplace platforms and social media platforms as Singaporeans carried out more online transactions due to COVID-19,” said CSA. This surely would have warranted attention for authorities to come up with counter or preemptive measures, together with social media, telcos and banking institutions. However, victims often find themselves let down by realities.
Comparison of Singapore’s vs China Police’s Anti-scam campaign/posters
We recognize China Police’s exemplary efforts and effectiveness in cracking down on scams nationwide, especially of Shazhupan. We would like to make the comparison of their publicity campaign vs Singapore’s. The above are general notices, being circulated or seen in Singapore. In comparison to the ones below, used by China Police, (besides the medium language used for the obvious reason) we observe:
Chinese police understand the core of these scam operations, are uniform in their messages, despite running their own campaigns in their own provinces/districts.
China police identify the different categories of these frauds and highlight to the public in their notices concisely.
More importantly, notices are placed in high traffic locations. In Shanghai, police are seen setting up booths around the neighborhoods to educate residents about types of scams as part of their anti-scam drive.
Most countries educating the public are often using simple descriptions that hit outside the bull’s eye, by not highlighting the 杀猪盘 (Shazhupan) modus operandi. We are not sure why the authorities and most of the local media are skirting around the key words, despite our continuous feedback to the media.
In China, Hong Kong Asian American and Taiwan, there are many newspapers and television media coverage on such Shazhupan scams including interviews of the police and the victims. In comparison, these are conspicuously missing locally, where flyers are the norm as shown above.
In January 2021, “INTERPOL has issued a Purple Notice to its 194 member countries outlining a specific investment fraud’s modus operandi on dating applications.”
We are puzzled, why this Purple Notice was not translated to more counter measures by most countries and the banking institutions.
Notices/Posters by the China Police
Banners put up by the Chinese
Regardless of what channel and medium the Police uses in educating the public, we can see the Chinese police put in concerted efforts in bringing messages across vividly. It is obvious that the Chinese police sees the urgency to educate the public, as they recognize these scams are sowing discord to social harmony, disintegrating families and causing havoc in the financial industry.
The urgency of highlighting these cybercrimes that often involve money-laundering, drug and human-trafficking, is much overdue. Worldwide, these frauds have been wrapped into the modus operandi of a typical Shazhupan, and have taken the world by storm in the last 2-3 years and are growing at an alarming rate each day.
The perpetrators openly taunt authorities worldwide. They are clearly aware of the loopholes present in the current systems and exploit them. These are: the challenges of border jurisdictions issues, seemingly more advanced technologies utilized by the more well-organized scam companies, the advantage of the complex divisions of labor (layering) in the telecom/internet grey chain industries (互联网业务黑灰产业链), exhaustive resources required to expand on the money-laundering money trails, the complicity of social media companies and crypto exchanges due to ineffective KYC or insufficient AML, as well as the warm receptions and protections they get in some host countries such as Myanmar, or the Golden Triangle region etc.
These scammers strongly believe that the possibility of them being caught is close to naught and the returns are so lucrative that they have no reason to stop. Besides China, authorities around the world are either keenly avoiding confrontation or lack resolve to go after the perpetrators, leaving the victims feeling helpless with no place or support to go to.