The Grind: Inside the Telegram-Group Investment Con

2026-06-03

It began, as these things tend to, with a stranger who seemed to want nothing. Marta—a composite, assembled from the case files of people who have sat across the same conference tables, but truer for being typical—was forty-one, a project manager at a logistics firm outside Warsaw, the sort of person who reads the terms and conditions. The message that arrived on her phone one Tuesday evening was not a pitch. It was a correction. She had posted, in a public forum, a mild complaint about her bank’s savings rate, and a man named Daniel had written to agree with her, and to mention, almost in passing, that he had stopped letting banks decide what his money was worth some years ago. He did not say how. He asked about her work. He was, she would remember later, a very good listener.

This is the first thing to understand about the kind of fraud that has quietly become the most lucrative on earth: it does not feel like fraud. It feels like friendship, and then like luck, and only at the end—when the account that showed a balance of forty thousand euros will not release four hundred—does it reveal itself as what it always was, which is arithmetic. The genre has acquired a name, coined by the Chinese syndicates that industrialized it: shā zhū pán, “pig butchering.” The animal is fattened before slaughter. The fattening is the point, and the fattening is done with kindness.

What follows is an anatomy—of how the con is built, why it works on the careful as readily as on the credulous, and why, in the cold language of a Polish courtroom, the fact that Marta clicked “confirm” with her own hand is not her shame but the perpetrator’s crime.

The Listener

For three weeks, Daniel sold nothing. He sent good-morning messages and market observations and, once, a photograph of a sunrise over what he said was the Adriatic. He was attentive in the way that people are attentive when they are paid to be, though Marta had no reason to think of it that way; the warmth was free, and free things rarely arrive with invoices. He mentioned a Telegram group—a few dozen serious people, no salesmen, no noise—where he and others shared what he called “signals.” She could look, if she liked. There was no charge.

The group was a small theater of prosperity. Members posted screenshots of gains rendered in the argot of the currency markets—four hundred pips here, a thousand there—and thanked one another with the fervor of converts. Newcomers were welcomed; skeptics were not mocked but gently pitied, as one pities a man who insists on walking when a car is right there. The signals, when they came, were specific: buy this, at this hour, close by that one. Marta did not act on them. She watched. And the signals, maddeningly, were often right.

Robert Cialdini, the psychologist who spent his career mapping the levers of persuasion, would have recognized the room instantly. Reciprocity: the gift of attention, of free signals, of a sunrise, each one quietly accruing a debt. Authority: Daniel’s nine years “in the markets,” his fluent jargon, his monthly recaps formatted like a bank’s. Social proof: the chorus of the grateful, testifying that the thing worked. Liking: the warmth, always the warmth. And the principle Cialdini added late in his life, in 2016—unity, the engineered sense of we, the inner circle to which one now, flatteringly, belonged. Marta did not feel that she was being worked on. No one ever does. The machinery of influence is invisible precisely in proportion to its skill.

When she finally asked how to begin, Daniel was, if anything, reluctant. He suggested she start small. He sent a referral link to a broker—regulated, he assured her, with an office in some agreeable jurisdiction—and walked her, screen by screen, through opening an account. The first deposit was modest, a few hundred euros, the price of a weekend. Within days it had grown. She watched the number climb on a dashboard built, she did not know, to climb.

The Meter

Here the story acquires a mechanism, and the mechanism has a name that predates the internet by half a century. In American securities law it is called churning: the practice, by a broker who controls a client’s account, of trading it not to enrich the client but to enrich himself, since his compensation flows from the volume of transactions rather than from their wisdom. It violates the antifraud provisions of the Securities Exchange Act of 1934; the Financial Industry Regulatory Authority forbids it; the courts have a settled, three-part test for it—control, excessive trading, and the intent to fleece. The faithless stockbroker of midcentury caricature, mowing his client’s portfolio for commissions, is its original villain.

Daniel was that villain in a new costume. He was not, in the technical sense, stealing—not yet, not in a way that would show on a ledger as theft. He was functioning as what the industry calls an introducing broker, an affiliate who steers clients to a brokerage and is paid for the privilege. The payment takes one of a few shapes: a slice of the broker’s revenue from the client’s trades, or a flat rebate for every “lot” transacted, or a markup buried in the spread—and, in the tiered arrangements common to the trade, the rate climbs as the volume does. The crucial feature, the one that turns an advisor into a predator, is that the compensation is indexed to activity, not to outcome. It is also recurring: as long as the client keeps trading, the affiliate keeps earning. The meter runs on volume, not on whether Marta is up or down.

Consider what this means for the man offering, in soothing tones, to “manage her capital safely.” His single most profitable outcome is the maximum possible churn of her account, sustained right up until the moment it is empty—provided he has harvested enough fees along the way. The relationship that presents itself as advice is, structurally, an ambush. The interests are not merely misaligned; they are inverted. He prospers as she is ruined, and the ruin, conducted at sufficient velocity, is how he prospers.

The Arithmetic of Ruin

It is tempting to file what happened to Marta under misfortune—a run of bad luck, a market that turned. This would be a misreading. Her loss was not bad luck. It was the expected value of the game, and the regulators have the numbers to prove it.

Begin with the instrument. The contracts Marta was trading—contracts for difference, or CFDs, leveraged bets on the direction of a price—carry, for the retail investor, a negative expected return. This is not an accident of the market; it is the business model. The provider earns from the spread, the commissions, the overnight financing charges, which means that the average client must lose, because otherwise there would be no provider. The European Securities and Markets Authority, the Continent’s market regulator, said as much in the analysis underpinning its 2018 intervention: the investor faces a negative expected return, or the provider’s model would be unsustainable. She was playing, in other words, a game whose mathematics were against her before she had clicked once.

How far against her is a matter of public record, and the figures are worth pausing over, because they contain a paradox that explains everything. When ESMA gathered data from actual brokers on actual accounts, one large firm reported that its clients won fifty-four per cent of their individual trades—better than a coin toss—and that eighty-three per cent of its accounts nonetheless lost money. Another reported fifty-one per cent of trades won, eighty-three per cent of accounts under water. The pattern held everywhere: a single trade was very nearly a fair coin, while the account, taken as a whole, was a near-certain loss. Across ten providers in one survey, eighty-seven per cent of accounts ended in the red.

The paradox dissolves once you see what the house edge does over a sequence. ESMA’s analysts worked a clean example using binary options, a cousin instrument, that makes the point with brutal economy. Imagine a wager that costs a hundred euros and pays a hundred and eighty if you win, with the odds of winning at roughly fifty per cent—the toss of a coin. The expected value of that wager is ninety euros: you are paying a hundred for a thing worth ninety. The house takes its ten euros whether you win or lose. Now place that bet twenty times. Intuition says you need to win ten of the twenty to break even. Intuition is wrong. You need to win twelve. Eleven wins and nine losses still leaves you down, because nine losses of a hundred outweigh eleven wins of eighty. The probability of getting those twelve wins is about twenty-five per cent—which is to say that the probability of an aggregate loss, after just twenty bets, is roughly seventy-five per cent. Lengthen the sequence and that figure marches toward certainty. This is the gambler’s-ruin theorem, dressed in the costume of a trading platform: when each wager carries a negative expected value, the more often you wager, the closer to inevitable your ruin becomes.

Churning, then, does not change the odds of any single bet. It simply runs the sequence faster, collecting a fee at every turn, hurrying the player toward a destination the mathematics had already chosen. Marta’s fifty-four per cent of winning trades was not a consolation. It was the hook—frequent enough wins to sustain hope, too infrequent to save the account.

And then there is leverage, which is to this process what gasoline is to a fire. Leverage lets a small deposit control a large position, magnifying gains and, far more reliably, losses. ESMA’s analysts illustrated it with gold. Take a CFD on ten thousand euros of gold. At twenty-to-one leverage, the client posts five hundred euros, and a five-per-cent fall in the price erases it. At a hundred-to-one—a level routinely offered by the offshore brokers in this trade—the client posts a hundred euros, and the deposit is wiped out by a one-per-cent move, the kind of thing that happens on an ordinary Tuesday before lunch. No crash is required. A dull day will do. Marta’s account, she would later realize, had been levered to a degree no European broker operating within the law was permitted to allow.

The Rules, and the Hole in Them

The European authorities are not naïve about any of this. Acting in 2018 under the markets regulation known as MiFIR, ESMA imposed a regime on CFDs that reads like a list of the precise wounds the instrument inflicts. Leverage was capped on a sliding scale keyed to volatility—thirty-to-one for the major currency pairs, descending to two-to-one for cryptocurrencies, those being, by the regulator’s own simulations, so violent in their movements that almost no leverage is survivable. Brokers were required to close a client’s position once his margin fell below half the minimum, a circuit breaker against total loss. Negative-balance protection ensured that a client could never lose more than he had deposited—a safeguard born of the day in January, 2015, when the Swiss National Bank let the franc float and certain investors woke to discover they owed their brokers tens of thousands of euros they had never possessed. Bonuses were banned outright, on the regulator’s blunt reasoning that they distract from risk, encourage trading, and, since most clients lose, simply deepen the losses. And every advertisement was made to carry a surgeon-general’s warning of a number: between seventy-four and eighty-nine per cent of retail accounts lose money. When the temporary European measures lapsed, Poland’s regulator, the K.N.F., made them permanent at home.

One clause in the regime is, for Marta’s case, the whole game. It forbids anyone to participate, knowingly, in arrangements designed to circumvent these protections—”including by acting as a substitute for the CFD provider.” The drafting has a quiet genius, because it anticipates exactly the trick that was played on her. Daniel’s broker sat offshore, beyond the regulation’s reach, which is how it could offer the hundred-to-one leverage and the deposit “bonus” that a licensed European firm would be jailed for offering. The bonus, in fact, was its own small trap: it inflated her usable margin, and its terms forbade withdrawal until she had traded a certain volume—a clause that, not coincidentally, fed the very churn that fed Daniel. A 2025 study of the Polish CFD market identified this offshore circumvention as the principal unresolved failure of the entire system. The protections are real. They simply stop at the border, and the men who run these schemes have read a map. The lesson, for anyone watching a dashboard climb, is unsentimental: the bonus that swells the account and the leverage that destroys it are not the features of a lawful broker. They are the fingerprints of an unlawful one.

Why the Careful Succumb

The most persistent myth about these frauds is that they prey on greed and gullibility, on people who had it coming. The truth is closer to the opposite. The schemes are engineered to defeat not weakness but the ordinary furniture of the human mind, and they work on the prudent because the prudent have the same mind as everyone else.

The deepest hook is the one the casinos discovered long ago. B. F. Skinner, conditioning his pigeons, found that the most tenacious behavior—the kind most resistant to extinction—is produced not by reliable reward but by reward delivered on a variable schedule, after an unpredictable number of attempts. It is the logic of the slot machine, and it is the logic of the early, irregular wins that Daniel’s signals produced on Marta’s account. Those wins were not luck and not generosity. They were the intermittent reinforcement that entrenches a habit and sustains the conviction that the next pull will pay—precisely when the statistics have begun to run the other way.

Atop this sits the economics of emotion. The sunk-cost fallacy ensures that the more one has put in, the harder it becomes to walk away, since walking away means conceding that the earlier decisions were errors. Cognitive dissonance does its quiet work: to spare herself the contradiction between her image of herself as a sensible woman and the fact of her mounting losses, the mind reaches for reasons to continue, and to deposit more, so as not to “waste” what came before. And over all of it presides loss aversion, the finding of Daniel Kahneman and Amos Tversky that a loss is felt about twice as keenly as an equivalent gain is enjoyed. So the losing position is not closed but chased—more money sent after bad, in pursuit of a break-even that recedes like a horizon. The surest route to a catastrophic loss is the desperate attempt to recover a small one.

There is, finally, a refinement that turns out to matter in a court of law. Because Marta kept her own hand on the mouse—because she herself clicked “confirm”—she felt that the decisions were hers, and the losses, therefore, her fault. This served Daniel twice. It kept her trading, since a woman who believes she is steering believes she can still correct course. And it seeded the guilt that would, for weeks after the account went dark, keep her from telling anyone at all.

“She Gave Him the Password”

That guilt is the cruelest of the con’s productions, because it is sincere and it is misplaced, and Polish law says so in language that ought to be read aloud to every victim who blames herself.

Article 286 of the Polish Criminal Code defines fraud as inducing another person, for material gain, to dispose of property unfavorably by means of deception, the exploitation of an error, or the exploitation of an inability to grasp what is being done. The voluntariness of the victim’s act is not a defense to the crime. It is the definition of the crime. This is the precise line that separates fraud from theft: the thief takes against your will; the swindler arranges for you to hand it over, smiling, under the spell of a falsehood he has planted. Marta’s consent, procured by deception, is not an exoneration of Daniel. It is the very element that convicts him.

Polish doctrine goes further, and the further point is the one that matters to the woman staring at her ceiling at three in the morning. It is settled in the case law of the Supreme Court that it does not matter whether the victim, exercising even minimal diligence, might have caught the lie. Even extreme carelessness on her part does not undo the offense. The crime is complete the moment the deceiver deceives, whether his deception was a baroque masterpiece or a crude lure that a more suspicious person would have seen through. The woman who cannot forgive herself for “not checking” may be told, with the authority of the highest court in her country, that the law does not require her to have been unfoolable. It requires only that someone fooled her on purpose.

The conduct rarely stops at a single statute. Where the offshore broker receives and launders the proceeds through shell companies and mule accounts, the money-laundering provisions of Article 299 come into play, with the fraud as the predicate offense. Where the operator dealt in financial instruments without a license—as these operators invariably do—there is an additional charge under the securities-trading act, the one the K.N.F. routinely cites when it refers a matter to prosecutors. And a civil road runs parallel to the criminal one: a fraud established under Article 286 is also a tort, and anyone who knowingly profits from the resulting harm may be liable for it—an exposure that can, in the right case, reach the brokerage that knowingly processed the introducing broker’s referrals. The basic offense carries six months to eight years. The men who run these operations are not, in the eyes of the law, unlucky investment advisors. They are felons.

The Second Knife

There is an epilogue to Marta’s story, and it is the part that ought to make a reasonable person angriest, because it is the moment the system turns on the wounded.

Some weeks after the account went silent—after the withdrawals stopped processing, after Daniel’s replies grew terse and then ceased, after she had understood, finally, what had been done to her—Marta received another message. This one came from a firm that specialized in recovering funds lost to investment fraud. They had, they said, traced assets connected to her case. They were confident. They required only a modest retainer, paid in advance, to begin.

This is the second wave, and it is not a coincidence. The names of fraud victims are themselves a commodity, compiled into what the trade calls “sucker lists” and sold onward to the next set of predators, who arrive costumed as attorneys, as cyber-units, as government investigators, as the very recovery firms a desperate person would pray to find. The advance fee is the tell, and it is the whole of the scheme: it is collected, and then the firm evaporates. Regulators on several continents have converged on a single, durable rule, and it is worth committing to memory, because it is the one sentence that defeats the entire genre. No legitimate party ever asks for a fee up front to return what you have lost.

Coda

The scale of the thing is difficult to hold in the mind. The F.B.I.’s Internet Crime Complaint Center recorded that investment fraud was the highest-loss category of cybercrime in 2024, with reported losses above six and a half billion dollars; the cryptocurrency-enabled pig-butchering variant alone accounted for $5.8 billion, across more than forty thousand complaints, a sixty-six-per-cent increase in a single year. Total reported losses reached a record $16.6 billion. Marta is one entry in a database, and the database is the size of a small nation’s economy.

What undoes the victims of this fraud, in the end, is not stupidity but the very faculties that make us social and hopeful and loyal—our willingness to trust a kind voice, to honor a debt, to believe that effort already spent must not be wasted, to keep faith with a group that has made us feel we belong. The con is a precision instrument turned against the better parts of the mind. The grind is rarely recognized as theft while it is happening, which is the secret of its efficiency; by the time it announces itself, the account is empty and the clock—the criminal statute of limitations, the hundred-and-twenty-day window to dispute a card charge, the few hours before a Telegram channel is deleted and the evidence with it—has been running for some time. The single most useful thing a person in Marta’s position can do is the thing the psychology of sunk cost most reliably prevents: to stop, to say it aloud, and to act before the clock runs out.

If you recognize yourself in this account, the early days are the ones that count. Preserve everything—the messages, the transaction history, the payment confirmations—before it can vanish. Check the date on your card payments; the window to dispute them is shorter than it looks, and it runs from the transaction, not from the disillusionment. Report the matter, to the prosecutor and to the regulator, while there is still a trail to follow. And do not, under any circumstances, pay anyone who promises, for a fee paid in advance, to bring the money back.