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Pig butchering and scams initiated through conversations are everywhere. Driven by international cybercrime gangs, they cost the people of the world billions of dollars every year.
Tracking conversational scams is a legislative and law enforcement nightmare. Criminals usually operate beyond national borders under extremely complex networks and hold countless bank accounts and cryptocurrency addresses.
However, a new first-of-its-kind artificial intelligence chatbot is doing some heavy lifting. The AI-powered solution creates AI personas that engage with bad actors, extracting vital intelligence.
Key Takeaways
- Netcraft’s AI chatbot infiltrates and disrupts large-scale “pig butchering” scam operations, creating personas that engage with scammers and expose their financial and technical infrastructure.
- Netcraft’s AI system has identified thousands of criminal bank accounts and cryptocurrency wallets across 73 countries.
- Netcraft customers include 10 of the 20 largest banks in Europe, 12 of the 50 largest banks in the world, 4 of the 10 largest technology companies, and 7 of the top 50 world governments.
- The AI chatbot aids law enforcement by providing actionable intelligence, dismantling criminal networks, and combating human trafficking.
- This AI technology represents a significant breakthrough in fighting cyber-enabled financial crimes and global conversational scams.
- Show Full Guide
Tackling Widespread Scams and Fraud with Innovative Proactive AI
On June 13, Netcraft announced that its new AI-powered solution has been communicated with criminals at scale. The AI system created AI personas that responded to emails and SMS messages that victims receive during a scam.
Through its chats with bad actors — some of which may be victims of human trafficking and forced to work in scams in Southeast Asia (United Nations PDF) — the Netcraft AI chatbot, or the Conversational Scam Intelligence platform, exposed a large hidden financial and technical infrastructure.
Netcraft said that following the money by disrupting money mule networks identified by the AI chatbot is the way forward to combating these crimes. Entire threat actor networks could be disabled in one fell swoop, Netcraft said.
Netcraft’s AI chatbot pretended to be a naive victim falling right into the hands of criminals, but was actually playing a longer game of collecting scammers’ phone numbers, emails, bank accounts, data, and cryptocurrency wallets.
Shutting Down Criminal Triads Linked to Human Trafficking
This new AI solution is a major breakthrough in innovation that combats pig butchering, romance scams, financial fraud, and other conversational scams. Criminals running these scams have largely managed to remain hidden and out of the reach of law enforcement actions as they escalate and grow thanks to AI too.
International organizations have warned that global conversation scams and frauds are out of control. In August 2023, the United Nations reported that criminal gangs in Southeast Asia are using torture and abuse to force hundreds of thousands of people into online scam operations that generate billions of dollars.
The U.N. human rights chief Volker Türk warned about criminalizing victims of human trafficking.
“People who are coerced into working in these scamming operations endure inhumane treatment while being forced to carry out crimes. They are victims. They are not criminals.”
Netcraft’s AI-driven chatbots could help law enforcement agencies working under international cooperation gain critical intelligence on global-scale human trafficking operations, how top ranks of these gangs move their money, and much more.
Pig butchering operations have the opportunity to target a tremendously broad range of people in different areas, speaking different languages.
As Michael Hasse, cybersecurity and technology consultant, told Techopedia, it’s ‘victim agnostic’ — anyone can be a target.
What Powers Netcraft’s AI Intelligence Tech?
Netcraft explains that the Conversational Scam Intelligence platform was carefully constructed. Its core technology is generative AI. It can disrupt nefarious scam attempts at scale and deploy countermeasures against criminal infrastructure.
The AI uses machine learning models and runs on more than 70,000 human-written rules that allow it to detect, disrupt, and take down services tied to illegal activities. The AI can also predict criminal behaviors by analyzing natural next steps.
Big banks, one of Netcraft’s top customers, are hit hard by these types of illegal operations and have much to gain from AI. Banks and financial institutions are also being pressured by increased regulations. For example, in the U.K., financial institutions are now required to take on a 50:50 financial risk (reimbursement) for fraudulent push payments.
As mentioned, the Netcraft solution could be a game-changer and have a big impact on the rates of these crimes. Netcraft customers include 10 of the 20 largest banks in Europe, 12 of the 50 largest banks in the world, 4 of the 10 largest technology companies, and 7 of the top 50 world governments.
73 Countries, 600+ Financial Organizations: What the AI-Bot Discovered
In an email sent to Techopedia Netcraft said they had exposed a vast network of criminal bank accounts spanning 73 countries and more than 600 financial institutions. In one single conversation, the Netcraft AI-chatbot got 17 mule accounts. The AI solution also identified millions in Bitcoin.
Netcraft also discovered criminal behaviors that range from active engagement to frustration.
“Criminals are eager to engage quickly and frequently and maintain these pig butchering, advanced fee fraud, investment, and romance scams over an average of more than 47 days.”
The Netcraft operation resulted in more than 40 pieces of actionable intelligence, including the discovery of hackers impersonating the investments team at Deutsche Bank on behalf of the Central Bank of Nigeria.
Posing as a victim the chatbot was at times intimidated and aggravated by scammers who lost their patience as they demanded the AI buy gift cards, make cryptocurrency payments, or online payments through providers like PayPal.
Other intel includes phone numbers, emails, WhatsApp accounts, bank accounts, and data from money remittance services such as Western Union.
“We have extracted thousands of criminal money mule bank accounts across 73 countries and more than 600 financial institutions. In one case, we have received 17 mule accounts from one conversation.
“The top four crypto wallet addresses Netcraft identified have received more than $45 million (1,000 BTC).”
Netcraft analysis found that on average, criminals send more than 32 messages despite receiving only 15 replies, highlighting that those doing the scams engage quickly and frequently. They maintain these scams over an average of more than 47 days.
This data could point to human trafficking victims. These have reported that they are forced to make specific amounts of money every day and have been electrocuted, beaten, or tortured to death in pig butchering prison camps in Burma (Myanmar).
Asian Triads, Money Laundering, Drugs and Terrorism
The Southeast regions where pig butchering scams operate are located close to casinos and illegal gambling venues where dirty funds are cleaned and re-enter the legal economy.
Greg Pinn, Director of Name Screening, Babel Street told Techopedia that pig butchering scams are one of the main new focuses for international money laundering.
“As criminals adapt to the digital age, this new breed of cyber-enabled financial crime poses a significant challenge for regulators and law enforcement.”
Pig butchering scams are believed to be run by South East Asian criminal triads. Pinn from Babel Street explained the global narcotics trade and the financing of terrorism are two of the most significant areas where money laundering plays a pivotal role.
“The illegal drug trade is estimated to generate around $650 billion annually, constituting about 30% of the total illicit economy. A significant portion of these funds is laundered from end consumers back to cartels.”
The scale and complexity of this process underscore the importance of effective anti-money laundering strategies in combating the global drug trade.
“In addition to narcotics, money laundering is also closely tied to the financing of global terrorism and the destabilization of regions worldwide.”
Pinn explained that by identifying and targeting the most significant money laundering operations and armed with high-tech tools, financial institutions, and law enforcement, agencies can substantially impact financial crimes and the underlying illegal activities that threaten global security and stability.
The Bottom Line
Netcraft’s AI-powered chatbot is a significant innovation in combating large-scale conversation scams like pig butchering.
Beyond pig butchering scams, this type of AI tech offers a glimpse into a future where AI can infiltrate complex criminal enterprises. By mimicking potential victims and engaging with criminals online, the AI can gather crucial intel on their infrastructure, communication methods, and financial networks.
This real-time intelligence, spanning borders and encompassing hidden aspects of criminal activity, can empower law enforcement to dismantle these organizations, liberate victims of human trafficking, and disrupt the flow of dirty money that fuels criminal activities worldwide.
