Businessman Scammed Out of $400K in Crypto, 3 Arrested in Hong Kong

Hong Kong police have arrested three individuals on suspicion of defrauding a businessman of HK$3.11 million, equivalent to about US$399,000, in crypto assets by offering him three bundles of counterfeit HK$1,000 banknotes.

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

Cryptocurrency scam uncovered

source Tell The 44-year-old businessman was shown three bundles of HK$1,000 banknotes at the Nathan Road location before being asked to transfer HK$3.11 million in Tether’s USDT stablecoin to a designated digital wallet, the South China Morning Post reported.

One of the informed sources was quoted as saying:

“Except for two real notes placed at the top and bottom of each bundle, the other notes were counterfeit notes, known as training notes.”

The source stated that the businessman asked to examine the banknotes, but the two accused, who appeared to be office employees, refused, stressing that they did not receive instructions from the store manager over the phone. After the victim found his behavior suspicious, he informed the police.

The accused are a 24-year-old man and a 42-year-old woman. In addition to these two individuals, Hong Kong police arrested another man after discovering the counterfeit banknotes at the office. The three were arrested on suspicion of obtaining property by deception and possessing counterfeit banknotes.

Cryptocurrency scams are on the rise in Hong Kong. In fact, police officers have seized 1,693 “training notes” in three other cases of cryptocurrency scams.

Rising Cryptocurrency Scams Force Hong Kong to Boost Skills

Hong Kong has established itself as a major cryptocurrency hub in Asia. However, along with attracting capital, the city-state has also seen an increase in fraudulent activities, forcing authorities to step up their skills. Experts NB Hong Kong has gained significant law enforcement experience in dealing with cryptocurrencies, enabling authorities to effectively track money laundering activities involving digital assets.

Meanwhile, Hong Kong’s Securities and Futures Commission (SFC) has stepped up its oversight of suspicious crypto entities. Earlier this month, the securities watchdog issued a Issued Warnings about seven cryptocurrency trading platforms operating illegally in the region without obtaining the appropriate licenses.

Since January 2020, the Hong Kong Securities and Exchange Commission has maintained an alert list, which currently includes 39 entries. In 2024 alone, 28 cryptocurrency exchanges have been flagged. The latest additions to the list are Taurusemex, Yomaex, Bitenes.org, BTEPRO, CEG, XTCQT, and Bstorest.