BlockBeats news, on September 27, according to the “Sing Tao Daily” report, the Criminal Department of the Wong Tai Sin Police District in Hong Kong conducted a law enforcement operation code-named “Joint Action” from September 19 to 26. During the operation, it successfully dismantled a group that specialized in using cryptocurrency. A local money laundering syndicate arrested 25 people and was involved in at least 39 fraud cases involving more than NT$7 million.

When describing the case, Senior Inspector Mak Ning-feng of the Wong Tai Sin District Criminal Division said that 25 people were arrested, 18 men and 7 women, aged between 19 and 65. Their reported occupations included construction workers, waiters, or being unemployed. The arrested persons include a group leader, three key members and 21 puppet account holders, respectively suspected of “obtaining property by deception” and “money laundering”. At the premises of the group leader, more than 20 electronic devices were seized, as well as two cryptocurrency cold wallets believed to be related to the case.

Through in-depth analysis, the police discovered that a local cryptocurrency money laundering syndicate was involved in at least 39 fraud cases in Hong Kong. The group began operations in May 2023, using puppet information to simultaneously open bank accounts and cryptocurrency exchange accounts. Details of the division of labor among key members: defrauding victims through different types of fraud. After depositing money into a designated puppet bank account, some key members immediately used the exchange account opened with the same puppet information to conduct user transactions (i.e. P2P trading), using the proceeds of crime. Yi Go Buy Cryptocurrency.

Later, other key members transferred the “laundered” cryptocurrency to the exchange account of the group leader through the same platform or cold wallet. In addition, the police found that the accounts opened by the group on the exchange platform were all opened as shell companies to further hide their identity. This money laundering method of “money in and money out” and using shell companies to hide identities poses certain challenges to police investigations.

Inspector Wen Wenjian added that the group involved in the case was involved in 39 fraud cases, mainly online investment fraud, online job hunting fraud and fake customer service fraud. There are 39 victims in total, 23 men and 16 women, ranging in age from 19 to 72 years old. Their occupations include clerks, students and housewives.

The total amount of losses exceeded HK$7 million, and the amount of a single loss ranged from HK$3,000 to HK$1.6 million. The largest loss was an online investment fraud case. The victim was a 38-year-old female saleswoman. She met the scammer on a social platform and was later tricked into investing in a fake website claiming to have higher returns than other platforms in cryptocurrency. The female victim believed it to be true, and within a month, she transferred nearly HKD 1.6 million 11 times to nine designated bank accounts of the scammer. Afterwards, the female victim tried to withdraw money many times but failed, and finally called the police for help.

The fraud technique involved is exactly that of “falsely claiming to involve cryptocurrency.” In addition, there are occasional reports that criminal groups have opened fake virtual currency exchange shops, claiming to have preferential benefits for buying and selling cryptocurrencies, and inducing victims to trade large amounts of cash. In fact, the victims’ cash is stolen. Therefore, when investing or trading virtual assets, you should first go to the China Securities Regulatory Commission website to verify whether the relevant platform has been licensed, and choose a reputable trading platform. If you choose a physical store, you should also choose a reliable store, such as whether the store is open every day. and its evaluation, etc.

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