In response to a rise in cryptocurrency-related scams, Hong Kong law enforcement has apprehended four individuals, including a minor of just 14 years, who are suspected of duping crypto owners with counterfeit banknotes. It is estimated that this deceitful operation has caused losses up to HK$11 million ($1.4m USD).
The announcement on July 28th by the Commercial Crime Bureau’s Chief Inspector, Lo Yuen-shan, indicates that these new arrests bring the total number of suspects tied to such scams to 14 since October last year. The suspects, whose ages range from 14 to 39, were apprehended on July 26th, investigated under charges of conspiracy to defraud, ownership and utilization of 5,000 counterfeit banknotes.
Authorities provided insights into the highly-structured working of these syndicates: roles were carefully distributed among members. Two subjects were spotted as key orchestrators, responsible for acquiring fake banknotes from a mini-storage unit in Mong Kok. These individuals also created an illusion of a legitimate enterprise at a location nearby.
Their modus operandi involved posing as a well-known cryptocurrency investor and luring victims with offers of higher than market value bids on digital currencies, using both in-person and online methods. The victims were led to the sham business and shown stacks of counterfeit HK$1,000 ($128) banknotes. To deceive their victims, only the top and bottom banknotes were genuine while the rest of the stack was fake. The criminals restricted the victims from unpacking the stacks and insisted on online transactions to finalize the deal. Authorities continue to encourage the public to maintain vigilance and verify the authenticity of financial transactions.