The Hong Kong Police have uncovered a cross-border, encrypted money-laundering ring for $118 million.

The Hong Kong Police recently announced that the Commercial Crimes Investigation Section had dismantled a criminal group that used a secure money-trading door shop for cross-border money-laundering and had arrested 12 persons, amounting to HK$ 118 million (approximately US$ 15 million).

500 head accounts used for money-laundering, partially financed by telecommunications fraud

According to the police, the arrests included two local heads of brain and 10 persons from the Mainland, aged between 20 and 42, nine men and three women. The survey found that local members recruited Mainlanders to visit Hong Kong to assist in the opening of a large number of shell accounts, distributed among traditional banks and the virtual banking system, through which funds are transferred and money is exchanged in encryption.

In an interview, the police commander Guo Jing Yi stated that the group had also arranged for other persons to use their bank accounts to extract cash and to take the funds to a virtual asset exchange store to complete the money-laundering operation in the form of encrypted currency. Preliminary investigations indicate that the organization has over 500 accounts.

Approximately $1.3 million of this amount was confirmed to be relevant to at least 58 fraud cases, further revealing the high correlation between the money-laundering network and the telecommunications fraud group.

As Hong Kong accelerates its development of digital assets, it simultaneously strengthens the fight against financial crime

According to police data, the number of fraud cases in Hong Kong has increased by nearly 12 per cent over the past year, with a cumulative arrest of over 10,000, indicating a high incidence of Internet and financial fraud.

While Hong Kong is actively promoting the development of the virtual asset industry, including through the establishment of compliance trading mechanisms and the introduction of emerging financial technology companies, the police have stressed that this does not represent deregulation of illegal practices.

The police reiterated that they would continue to combat all crimes involving the use of virtual assets for money-laundering, fraud, etc., and called on citizens to be vigilant in not lending personal account information at will or engaging in suspicious financial activities.