FATF Report: Pig Butchering Scams Cost Tens of Billions in USD A Year, Operating Across the Globe

The Financial Action Task Force (FATF) published a new report on Thursday that follows the money surrounding pig butchering scam compounds. Losses to organized crime groups operating these scam compounds are estimated to reach tens of billions of dollars per year, not including the psychological damage done to scam victims.

Pig butchering is a type of long-term, online-based scam that is based on romance or friendship and fraudulent investment opportunities, typically involving cryptocurrency. The perpetrator typically gains the trust of the victim over weeks or months and then proceeds to encourage them to transfer their funds into investment accounts controlled by the perpetrator’s organized crime group. The money transferred is usually never seen again by the victim. The term “pig butchering” comes from the concept or metaphor of “fattening the pig,” by building deep emotional trust with the victim, before taking them to market to be “butchered,” i.e. defrauding them of large sums of money.

The FATF leads global action to tackle money laundering, terrorist and proliferation financing. The 40-member body sets international standards to ensure national authorities can effectively go after illicit funds linked to drugs trafficking, the illicit arms trade, cyber fraud and other serious crimes.

Pig Butchering Scams Are a Global Phenomenon

While the focus on pig butchering operations has been largely on centers operating out of Southeast Asia, the FATF report, “Combating End-to-End Illicit Financial Flows linked to Scam Compounds,” covers scam compound activity across jurisdictions in Africa, Europe, the Americas and across Asia.

The FATF estimate of the size of pig butchering scams means that the method of defrauding individuals now accounts for a significant portion of the nearly $450 billion estimated to be lost to fraud globally by the Global Anti-Scam Alliance (GASA) in its Global State of Scams Report 2025.

The report identifies practical approaches to disrupting scam compounds. It maps the financial and non-financial infrastructure on which criminal networks depend, including payment services, virtual assets, technology and telecommunications, to increase global capacity to disrupt criminal activity before victims make payments, as well as after.

There are victims on both sides of the pig butchering equations. Most of the low level people who handle the interactions with financial targets are victims of human trafficking and may have been recruited through fraudulent job offers, debt bondage, violence and threats of violence and other violations of basic human rights.

An estimated 120,000 people have been forced to carry out online scams in the country of Myanmar alone, and people over 80 jurisdictions have been identified in scam compounds across Southeast Asia. 

On the opposite end of the scams, are people from over 100 different jurisdictions who have suffered irrecoverable losses once funds are cashed out, moved offshore and/or converted into cryptocurrencies. 

FATF Encourages Tackling Scam in Early Stages

The report found that countries are currently more effective at tackling scam compounds through downstream action, such as targeting victim payments, proceeds, and asset tracing. Unfortunately, these actions occur after much of the pain associated with the scam has already occurred. The report called on countries to combine downstream interventions with upstream disruption that targets the wider criminal infrastructure. By identifying early signals such as fraudulent advertising, recruitment activity, malicious domains and suspicious phone numbers and telecom indicators, fraud can be detected even before a financial transaction occurs.

A first step in the FATF’s broader anti-fraud plans, the report includes almost 120 case studies and good practices, spanning more than 60 jurisdictions, that highlight how collaboration is helping to disrupt scam center activity around the world. 

Perhaps the most notable case study is the use of “Scam Signals” technology in the UK. The technology covers 85% of UK mobile phone users. In real-time, it sends a privacy regulations-compliant risk indicator when the customer is authorizing a payment. The technology is associated with a 41% reduction in the number of Brits scammed and a 44% decline in fraud losses due to APP fraud scams.