Hong Kong police arrest four people, youngest 14 years old, in major cryptocurrency fraud crackdown

Hong Kong police have arrested four individuals, including a 14-year-old, in connection with a syndicate using counterfeit banknotes to defraud cryptocurrency owners. This operation resulted in losses of up to HK$11 million (US$1.4 million). The arrests are part of ongoing efforts to combat the rise in crypto-related scams in the region.

Details of the Scam

Chief Inspector Lo Yuen-shan of the Commercial Crime Bureau disclosed that these arrests bring the total number of individuals apprehended in connection with these scams to 14 since October of last year. The suspects, aged between 14 and 39, were detained on July 26 on charges of conspiracy to defraud, possessing, and using 5,000 counterfeit banknotes.

The police described the structured nature of the syndicate, with specific roles assigned to each member. Two suspects were identified as the masterminds responsible for procuring the fake banknotes from a mini storage facility in Mong Kok, disguising a nearby location as a legitimate business.

Deceptive Tactics

By impersonating a well-known cryptocurrency investor, the fraudsters attracted victims with offers above the current market price for digital currencies, targeting them online. Victims were invited to the fake store, shown stacks of counterfeit HK$1,000 ($128) banknotes, with only the top and bottom notes being real to deceive them into believing the entire stack was genuine.

The suspects insisted on online transactions to settle the deal, prohibiting the victims from untying the stacks.

Financial Fraud Impact

Once the cryptocurrency was transferred, the scammers swiftly moved the assets out of the account and refused to pay, leaving the victims with nothing. Chief Inspector Lo noted that these tactics were common in recent cases, with the group and others defrauding 12 victims of HK$11 million (US$1.4 million) from October 2023 till the arrest.

The arrests underscore the ongoing battle against financial fraud in Hong Kong, particularly involving digital currencies.

Ongoing Investigations

Meanwhile, a worldwide manhunt is underway for two well-known Hong Kong crypto influencers previously linked to the embattled JPEX exchange in Dubai. They face allegations of theft, fraud, and money laundering, prompting Interpol to take action.

Related Reading：Interpol issued a red notice for JPEX founder "Coin Master" Wong Ching Kitand his associate Mok Tsun Ting