Some of the world’s biggest cryptocurrency and social media companies, as well as other tech giants, are teaming up to better protect users from online scams.
A new cross-industry coalition, Tech Against Scams, containing the likes of Coinbase, Kraken, Ripple and Gemini, as well as Match Group (Tinder and Hinge’s parent company), Meta, and the Global Anti-Scam Organization, to help reduce the amount of successful scams out there.
Tech Against Scams is a platform where these organizations can come together and share knowledge and best practices on combating the scammers’ usual tools - and the companies have also pledged to share threat intelligence and other tips to educate and protect consumers.
Pig butchering
A team-up between cryptocurrency firms and social media organizations makes perfect sense. With the rising popularity of blockchain technology, and the increase in price of Bitcoin, the number of scams and fraud has steadily been growing.
In 2023 alone, people have lost more than $2 billion to hacks, scams, and exploits, and in many of these instances, it all starts with a fake social media account.
In fact, the coalition has specifically singled out so-called “pig butchering” scams:
"Scammers and the organized criminal groups behind pig butchering schemes target people across many internet services, making it hard for any one company to see the full picture of malicious activity and counting on each of us working in silos," said Guy Rosen, Chief Information Security Officer at Meta.
"We hope that this coalition will serve as a force multiplier for security teams at tech companies to share threat insights and trends to enable more impactful disruptions of scam networks around the world."
In “pig butchering”, the “pig” is first “stuffed” before it gets slaughtered. A scammer will create a fake social media account, then try to engage in conversation and convince the victim to invest their money in a fake cryptocurrency project.
Over the course of weeks, or months even, the victim will be able to track the “growth” of their investment, and maybe even make a small withdrawal. This will give them the confidence to invest more and more, which is essentially the “stuffing” part of the process.
Finally, when the victim has no more funds left to invest, they will realize that they cannot withdraw their money.
Tricksters will tell the victim to call customer support, usually run by the same people. The “customer support” will try to convince the victim to pay extra fees to be able to withdraw, one last attempt at squeezing the very last penny out of the victim’s wallet.
"Tech companies across industries collaborating with each other is essential for preventing criminal activity, and ultimately helps online platforms stay ahead of, and develop effective solutions for, various types of financial crimes," said Yoel Roth, VP, Trust & Safety at Match Group.
"As we work to make it harder for scammers to defraud people, we will also continue investing in new technologies to help disrupt fraud and scams faster, and get people the support and resources they need."
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