Alabama Regulators Recover $125,000 in Crypto Assets from Pig Butchering Scams

Alabama securities regulators have successfully recovered over $125,000 in crypto assets for two residents who were victims of "pig butchering" romance scams. These scams resulted in a total loss of nearly $580,000 for the victims. The scams involved convincing the victims to invest in fraudulent trading platforms over several months.

The Alabama Securities Commission (ASC) recovered $53,227.81 for a Baldwin County resident who lost approximately $185,000. The victim met her suspected scammer through the Bumble dating app and was convinced to purchase and transfer over $185,000 in crypto to what appeared to be a legitimate trading platform. However, it was actually a wallet controlled by the criminal. When she tried to withdraw funds after being told her investment had grown to over $443,000, she was asked to send additional crypto to pay supposed taxes—a common red flag that prompted her to contact authorities.

The ASC also recovered $73,927.68 for an Etowah County victim who was defrauded of $395,000. The victim encountered their scammer through a WhatsApp advertisement and was persuaded to invest $395,310 in a fraudulent platform falsely claiming association with Charles Schwab and SEC registration. Financial services firm reported suspicious activity when the victim attempted large withdrawals for crypto investing.

Pig butchering scams have become increasingly sophisticated, exploiting both the anonymity of digital assets and victims' emotions through carefully orchestrated romance schemes. These scams have become a significant form of crypto fraud, with criminals leveraging crypto's irreversible transactions and cross-border capabilities to steal billions from unsuspecting individuals.

Federal authorities have stepped up enforcement against the infrastructure enabling these scams. In March, the U.S. Treasury sanctioned a Philippine-based technology company and its Chinese administrator for facilitating pig butchering and other crypto fraud schemes that defrauded Americans of more than $200 million.

The ASC has urged immediate reporting of suspected fraud, emphasizing that delays dramatically reduce recovery chances. The regulator continues to see an increase in cryptocurrency fraud, including pig butchering scams. Most cyber crimes originate overseas, and the transactions are instant, making it nearly impossible to apprehend the criminals or recover funds.

Crypto scams recorded at least $9.9 billion globally in 2024, with pig butchering accounting for 33.2% of all scam revenue. While pig butchering revenue grew nearly 40% in 2024, the number of deposits surged 210% year-over-year, with average deposit amounts declining 55%. This suggests that criminals are conducting shorter cons to expand their victim pools rather than the traditional months-long relationship building.