seven years, The FBI’s Internet Crime Complaint Center (IC3) tallied reports of all different types of digital crimes received by US law enforcement agencies and found that commercial email compromise scams account for the highest total annual losses. But in the annual Internet Crime Report for Events 2022, released today, “investment” scams have surpassed all other scams to become the biggest digital threat, costing $3.3 billion last year.
IC3 reports that BEC, where attackers trick businesses into making fake payments or intercept legitimate payments, will cost nearly $2.4 billion in 2021 and $2.7 billion in 2022. In other words, these attacks remain a significant and rising threat. But investment scams, especially those claiming to offer access to cryptocurrency investments, have exploded in the past 18 months. They’re particularly motivated by so-called “pig-killing” scams, in which attackers cold-contact targets via text message or other messaging platforms, start a conversation to build trust, and then introduce the idea that they can help the victim come to their door in a Profitable investment deal.
Overall investment fraud losses will be $3.31 billion in 2022 compared to $1.45 billion in 2021, an increase of 127%. The FBI noted that cryptocurrency investment scams will cost $2.57 billion in 2022, up from $907 million in 2021, an increase of 183%.
IC3 tracked the hog-killing attack by that name and categorized it as a romance scam rather than a cryptocurrency scam in 2021, noting that hog-killing-related losses stood at $429 million that year. In the new report, IC3 did not mention the term “pig slaughter”, but instead said in an appendix that “one complaint may have more than one crime type”.
All the facts and figures appear to reflect IC3’s efforts to rapidly reclassify and recalibrate its understanding of how these scams operate amid the rapid rise of the hog slaughter industry. But there are no absolute numbers to compare, so depending on how you break down the different types of scams, it’s hard to get a clear picture. For example, love fraud (also known as “trust fraud”) fell from 24,299 complaints and nearly $956 million in losses in the 2021 IC3 report to 19,021 complaints and approximately $736 million in losses in 2022. Meanwhile, last month, the US Federal Trade Commission said it had received nearly 70,000 reports of love scams in 2022 and reported losses of $1.3 billion.
“The number of victims of crypto investment scams and the dollar losses of these investors are at an all-time high,” the FBI wrote in its 2022 Internet Crime Report. “Many victims took on huge amounts of debt to cover losses from these fraudulent investments.”
Researchers who have been tracking slaughtered pigs say the trend is clear. For example, in recent research by security firm Sophos, senior threat researcher Sean Gallagher tracked down a criminal campaign that initially appeared to have amassed roughly $500,000 worth of stolen cryptocurrency over the course of a month. However, after continuing the investigation and identifying more wallets connected to the attackers, Gallagher concluded that the gang stole approximately $3 million over five months.
