Hong Kong police have arrested 12 people involved in a cross-border money laundering scheme that relies on encryption and more than 500 bank accounts, and laundered $118 million ($15 million), local news outlets reported.
The syndicate was demolished on May 15th, with nine men and three women arrested in mainland China and Hong Kong.
The suspect allegedly recruited others to open a bank account to receive revenue from the fraud case. The fraud case was converted into crypto exchange shop codes to wash illegal funds, a Hong Kong commercial reported on May 17.
The criminal organization has planned and carried out money laundering activities by renting housing units in Mongkok’s Hong Kong district. Of the $15 million laundry, more than $1.2 million was linked to 58 reported fraud cases.
I got caught up in action
Following police surveillance on May 15, Bust attempted to convert cash into crypto at a crypto exchange shop near Tsim Sha Tsui after two recruits left the syndicated Mongok base (the bank visits the bank and the other an ATM).
Police arrested both individuals on the spot and seized about $770,000 ($98,540) in cash before the funds were washed. Ten other people between the ages of 20 and 41 were quickly arrested.
Police were seized with about $1.05 million ($134,370) of cash on more than 560 ATM cards, multiple mobile phones, bank documents and records related to crypto transactions.
A senior inspector at the Hong Kong Commercial Crime Bureau claimed that individuals often used their friends and family bank accounts to wash stolen funds.
Hong Kong reported a 12% increase in fraud reports in 2024 from the previous year, with authorities making fraud-related arrests of more than 10,000 people. Of those arrests, approximately 73% involved individuals who held Stooge Bank accounts.
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Pollution will arise as Hong Kong continues to deploy a cryptographic regulatory framework to support local innovation, protect consumers and establish itself as a crypto hub.
Hong Kong’s Securities and Futures Commission introduced new rules for crypto exchanges offering staking services in April. Two months ago, securities regulators deployed a roadmap, improving market access, optimizing compliance, expanding product offerings, strengthening crypto infrastructure and fostering relationships with industry players.
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