One Reason You're Getting All Those Fake ‘Wrong Number’ Texts? Crypto.
No, her name isn't Vicky and she didn't think you were Mary. It's all part of a billion dollar scam that might not exist if not for crypto.
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Note: this piece grew out of my interview with Zeke Faux. We talked about a lot of other stuff as well, which you can listen to here.
Between three and five times every day, I’ll get a seemingly innocuous text from an unknown number, containing anodyne, occasionally weirdly specific greetings and queries.
“Let’s practice yoga together tomorrow.”
“I came to your house this morning, but didn’t see you.”
“Hi… are you the store manager of Barton G. The Restaurant?”
“I’m a friend of Steve Sedquist. He told me you have a great car here.”
I get them so often that I only had to go back a few days to find these real examples. From experience, I know with a great deal of certainty that whoever is on the other end of these texts doesn’t actually think I’m an acquaintance of Steve Sedquist or the manager of the Barton G restaurant. Sometimes I’ll play along anyway for a bit, depending on how much I’m trying to put off whatever I’m doing that day, and try to catch the sender in some variation of a DEEZ NUTS joke (Bofa, Wendy’s, are you into fitness, Updog, etc.).
I’ve been able to “get” the recipients on occasion, and I’ve seen exchanges from friends that actually pissed the person off enough that they break character and start sending insults, sometimes in foreign languages. More often though, I just get more benign pleasantries. It’s hard to tell if they’re actually responding to things I’ve said or just going down a script. At some point they’ll usually send me a picture of an attractive but chastely-bland looking Asian woman they claim to be. You imagine there will eventually be an “ask,” but actually getting to it takes more attention span than I’ve ever been able to muster.
The big question throughout it all: how does this scam even work? It seems incredibly time-consuming. Can this even be profitable? And yet, it must be profitable, or else why would it be so commonplace?
While it’s hard to measure the man hours that go into it or the scale of the actual monies coming out of it (by most accounts, it’s large), there is one clear reason why these texts suddenly seem so ubiquitous. And it goes back to cryptocurrency.
Connecting blockchain-based e-money to random texts from strangers about car shopping or yoga feels like a tall task, but that’s exactly what financial journalist Zeke Faux does in his new book, Number Go Up: Inside Crypto’s Wild Rise and Staggering Fall. In fact, text scams being connected to crypto is just one of many insane stories and incredible revelations, from Faux’s time trying to trace the origins of crypto and catalog its many eccentric characters (not to mention its connected scams and knock-on effects, of which text scams are just one).
The text scams in question actually have a name – “Pig Butchering,” apparently a reference to the way you fatten up a porker before slaughter – and it’s often carried out by human trafficking victims in Cambodia. But that’s getting ahead of ourselves.
Back in 2022, Faux was a reporter covering the financial sector for Bloomberg news, at a time when the Crypto currency boom seemed to be minting new millionaires and billionaires every day. Many things about it seemed pathologically sketchy and appeared to exist in defiance of existing financial rules and regulations. Faux came to be preoccupied with Tether, a so-called “stablecoin” whose value was “pegged” to the US dollar. The idea was that the value of Tether, which existed largely to underpin trade in other forms of crypto, would never fluctuate wildly because it was always backed by real assets and worth a dollar. And yet, try as he might, Faux couldn’t seem to find any actual evidence for those assets. It all seemed dubious at best, and the guys in charge of Tether seemed to have a history of dodgy dealings.
Over the course of the next few years, Faux watched as other stablecoins plummeted to zero and countless other crypto and crypto adjacent financial moguls pulled rugs and fled the country or went to prison for securities fraud. Meanwhile, Tether flourished. At times it seemed to Faux like he’d chosen the only crypto business not to face any consequences.
“I mean, literally, I could have picked any crypto company and been like, ‘This is the one I'm going to expose,’ and I probably would've seen it fail,” Faux tells me. “So many of the biggest names in crypto went down during this period.”
The only silver lining was that in investigating his white whale, Faux managed to learn a number of things about crypto’s origins and its downstream effects, many not well publicized or never before reported. “Tether was so central to the crypto world that it took me on this weird journey, and in the end, it might've been the best one to follow,” Faux says.
For instance, “Pig Butchering,” Faux comes to discover, probably wouldn’t exist without crypto.
“At some point, I hear that Tether is really popular among these pig butchering scammers,” Faux tells me. “These are people who go on dating apps, LinkedIn, Facebook, whatever, but also spam text messages. So if you get messages that are like, ‘Hey, Tim, did you pick up the dog food on your way home?’ That’s them.”
“I played along with one in the book, and usually they’ll apologize for the wrong number,” Faux says. “They'll say, ‘Hey, let's be friends.’ Then they'll send you a picture. They are a sexy person of the opposite sex. In my case, it was a youngish Asian woman who went by ‘Vicky Ho.’ And what they do is they don't immediately try to scam you. They try to build up some sort of rapport.”
Basically, your proverbial Vicky Ho will generally, over the course of however many pleasantries, display obvious signs of wealth. She might mention the Ferrari she drives or a vacation home to which she’s traveling in some glamorous place. The idea, Faux says, is that you’ll eventually ask how it is that she (or he) makes so much money.
“Then she’ll say, ‘Well, my uncle has taught me some pretty cool secrets about the world of cryptocurrency,’” Faux says.
“Eventually mine had me download this crypto trading app. Vicky will tell you, ‘Hey, download Coinbase. Download Crypto.com,’ some normal crypto app. Using that app, acquire some Tethers, which are always worth a dollar, so don't worry, it's pretty safe. And then she will give you an address and say, ‘Yeah, this is the address to deposit in the special app.’”
The app will take money directly from your account to theirs, but the scammers will often take pains to make it all seem legit and aboveboard.
“From there, they'll show you how much you're making in your special account. They'll even let you take out small amounts to help establish that it's real,” Faux says. “I've talked with people who send in hundreds of thousands of dollars. I think the record is this one guy, who sent in $47 million. He was a banker, and he started embezzling from his bank to send more. The bank failed.”
The banker in question indeed worked at Heartland Tri-State Bank in Kansas, and was also taking money from his church and his investment club in order to pay his scammer. Who the scammer actually was or what the banker was told aren’t yet public. The FDIC eventually took the bank into receivership.
And that’s usually how the stories play out in this part of the world. Someone gets taken in by a faceless scammer, loses a fortune to an opaque scheme, and the consequences begin to pile up. Yet many of the stories about them end without ever answering the big questions. Like who is doing the scam and how does it work?
Faux did an impressive amount of shoe leather reporting for his book, including actually traveling to Cambodia where so many of the Pig Butchering scams originate. And yes, many of them seem to be being carried out by human trafficking victims. Which does, sadly, tend to make trying to get one to fall for an updog joke a little less funny.
“In Cambodia, there are whole office towers surrounded by barbed wire with armed guards, where hundreds of people have been lured with job ads, Faux says. “The ads are like, ‘Come work in this casino in customer service. You'll get a thousand bucks a month.’”
“But then when you get there, they're like, nope, give us your passport. You're not leaving. You're going to be scamming people. And if you don't hit your quota, you might be beaten, shocked with electric batons, or even worse."
Faux actually visited, along with a pair of local reporters as guides, the areas of Cambodia where this was happening – parts of the country apparently controlled by Chinese organized crime and unofficially tolerated by the Cambodian government. He heard the stories from survivors, about their families being charged five or ten grand for their freedom while they were spending all day doing pig butchering, trying to hit their quotas. And the local economies there? They all seemed to work on Tether.
In contrast to places like El Salvador, where so-called “Cool Dictator” Nayib Bukele had loudly embraced Bitcoin and tried to make it the official currency, but where few of the locals seemed to know how to use it let alone want to (as Faux had discovered in other reporting); these parts of Cambodia actually were using Tether in the manner crypto promotes – as currency.
“Obviously the scammers would be more successful if you could pay by Visa, right?” Faux says, partly answering why these Pig Butchering scams seem so slow building and involved. “Because it's a lot of work to teach you to use crypto. But if you used your Visa card, there's fraud protection, they'd get their accounts shut down – it just wouldn't work. With crypto, I can zap my money over there instantly, and there's no refunds. There's no clues for the cops to track.”
And that’s partly the rub. In tracing the origin of his blockchain-based white whale, Faux inadvertently stumbled into one of the most ornate and eccentric examples of the butterfly effect ever documented. Every player in the crypto story seems somehow more eccentric than the last, each unintended consequence more obtuse and absurd. Tether, for instance, is a product partly dreamed up, it seems, by a former child actor from the Mighty Ducks movies.
Brock Pierce, who played a young Gordon Bombay in the Mighty Ducks flashback sequences and later starred opposite Sinbad in First Kid, originally entered the technology industry while still a teenager. During the first dot com boom, he was pitching a startup that was basically streaming video aimed at kids, but well before streaming video was technologically feasible. If the product was flawed, Pierce’s business partners were worse.
“I want to be careful what I say here, to stick to what's in the legal record,” Faux says. “But the founder of the company was a total creep who surrounded himself with teenage boys and allegedly preyed on them.”