Businessman defrauded of $400,000 in crypto, 3 arrested in Hong Kong

Hong Kong police have arrested three people suspected of swindling a businessman out of HK$3.11 million, worth about $399,000, in crypto assets by offering him three bundles of counterfeit HK$1,000 bills.

Officers reportedly seized 10,978 fake HK$1,000 notes during a raid at the Mong Kok office where the fraudulent transaction took place last week.

Cryptocurrency Fraud Failure

A source told the South China Morning Post that the 44-year-old businessman was shown three bundles of what appeared to be Hong Kong $1,000 notes at the Nathan Road location before being ordered to transfer 3, 11 million Hong Kong dollars in Tether stablecoin USDT to a specified digital wallet. .

An insider was quoted as saying:

“Except for two genuine bills placed at the top and bottom of each packet, the others were fake bills, known as training bills.”

The source also mentioned that the businessman asked for the tickets to be inspected. However, the two accused, who appeared to be office employees, refused, claiming that they had not received instructions from the store manager over the phone. After encountering the suspicious behavior, the victim notified the police.

The defendants in question are a 24-year-old man and a 42-year-old woman. In addition to these two individuals, Hong Kong police later arrested another man after discovering the fake notes at the office. The trio were arrested on suspicion of obtaining property by deception and possession of fake notes.

Cases of fraud involving crypto transactions have increased in Hong Kong. In fact, police officers seized 1,693 “training notes” in three other fraud cases involving crypto transactions.

Rising crypto fraud forces Hong Kong to upskill

Hong Kong has established itself as a major crypto hub in Asia. However, as well as attracting capital, the city-state has also seen an increase in fraudulent activity that has forced authorities to step up their skills. Experts note that Hong Kong has built up significant law enforcement experience in dealing with crypto, allowing authorities to effectively track money-laundering activities involving digital assets.

At the same time, Hong Kong’s Securities and Futures Commission (SFC) has stepped up its oversight of suspicious crypto entities. Earlier this month, the securities watchdog issued warnings against seven crypto trading platforms operating illegally in the region without proper licenses.

As of January 2020, the Hong Kong SFC maintains an alert list, which currently includes 39 entries. 28 cryptocurrency exchanges were flagged in 2024 alone. The latest additions to the list are Taurusemex, Yomaex, Bitones.org, BTEPRO, CEG, XTCQT and Bstorest.

SPECIAL OFFER (Sponsored) Binance Free $600 (Exclusive to CryptoPotato): Use this link to register a new account and receive an exclusive welcome offer of $600 to Binance (full details).

2024 LIMITED OFFER on BYDFi Exchange – Up to $2888 Welcome Reward, Use this link to register and open a 100 USDT-M position for free!