The Suspect Was Arrested in Hong Kong for Defrauding CryptoTraders of HK $1.5 Million

Written by C, Fiona

Last updated: 2022-05-12

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On Tuesday, a Hong Kong man was arrested for stealing HK $1.5 million from a female trader in Tsim Sha Tsui, south of Kowloon, Hong Kong.

The Defrauding Process

A 24-year-old man was arrested by Hong Kong Police on Tuesday on suspicion of stealing funds from a Hong Kong citizen, a crime punishable by up to 10 years in prison. Allegedly, the suspect lured the victim and two colleagues to the meeting room of a store in Tsim Sha Tsui, and the victim transferred HK $1.5 million (US $191085) into an E-wallet. The suspect then left the premises and pretended to get cash back for the victim. The victim and her colleagues then found them locked inside and called the police. The police found the victim in Sham Shui Po, North Kowloon on Tuesday.

The police did not recover any money, but some personal belongings of the suspect were found in the fake store rented in the name of the shell company. “In the store, the note counter is not powered on. What looks like a computer is just an empty box,” Tang Shandong, a police officer of the Yau Tsim criminal investigation team, said Wednesday.

Police Appeal For Caution

Mr Tang called on the public to be cautious when conducting financial transactions with unidentified people and use a trusted platform. In another incident in June 2021, a man was defrauded of HK $124 million by two men and a woman, who promised a huge return on investing in a cryptocurrency called “filecoin”. When the victim found that after the price of filecoin plummeted, he was unable to withdraw funds and the so-called investors were missing, he called the authorities.

Cryptocurrency crimes, especially those involving money laundering, are not new in Hong Kong. Criminals convert money into cryptocurrency to achieve rapid cross-border transactions. Since the establishment of the anti fraud law enforcement department in July 2017, the authorities have estimated that the ill gotten gains of local and international swindlers worth US $3.72 billion have passed through Hong Kong bank accounts and cryptocurrency wallets.

The police can intervene in about 31% of these transactions. At the same time, HK $19.94 billion is still in the hands of international criminals, who cannot get it. “The deceived person was deceived and transferred cryptocurrency directly to the electronic wallet provided by the criminal,” the police said.

Register With Local Regulators

In response, the former British colony required all cryptocurrency trading platforms to register with local regulators and comply with anti money laundering and counter-terrorism financing rules.
Since last year, anti money laundering has become the focus of attention

Money laundering checks have put some companies in trouble. In the United States, the OCC withdrew its approval of the federal license of anchorage digital bank as a cryptocurrency custodian and service provider for retail investors on the grounds of insufficient anti money laundering measures in April 2021. In August, a few months later, bitmex was fined $100 million by the commodity and Futures Trading Commission for failing to implement adequate anti money laundering policies.