Hong Kong Crypto Operation: 6 Arrested in Money Laundering Case - COINTURK NEWS
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Hong Kong Crypto Operation: 6 Arrested in Money Laundering Case

8:10 am (68 days ago)
July 16, 2023

In the past, cryptocurrencies were more associated with illegal activities, but fortunately, they have managed to shake off this reputation on a global scale. However, there are still malicious individuals who use cryptocurrencies for illicit purposes. Governments are focusing on crypto regulations and addressing crimes in this field. Hong Kong recently announced its latest crypto operation.

The Hong Kong Crypto Operation

According to a statement by the police on Friday, a Hong Kong high school student was among the six arrested individuals who were taken into custody for dismantling a cross-border structure suspected of laundering over 100 million HKD (12.7 million USD) in illicit proceeds. The student was suspected of assisting the group in laundering illegal funds by using their cryptocurrency trading accounts to conceal the origin and flow of the proceeds.

Senior Inspector Chu Ming-man from Hong Kong Island’s anti-triad team stated that digital currencies were ultimately transferred to offshore e-wallet accounts to avoid detection.

“In this investigation, we observed that the organization was laundering 1 million Hong Kong dollars daily. Within three months, they laundered 100 million Hong Kong dollars.”

Based on the intelligence received, law enforcement initiated the investigation into the organization in late April and sought assistance from their Chinese counterparts on the mainland.

Crypto Crime Profits

The organization opened bank accounts on the mainland to collect proceeds obtained through various frauds. The members then used their bank cards to purchase valuable items such as gold jewelry and watches in Hong Kong to launder the illegal funds. Chu stated that the group would then take the proceeds from the sale of these valuables and buy digital currencies, creating an additional layer of transactions to conceal the flow of illegal funds.

“This was a well-organized money laundering organization with clear division of labor and multi-layered approaches to increase the difficulty of police investigation.”

Police collecting evidence arrested five men and one woman through a series of raids across the city on Thursday. Among the six suspects, ranging in age from 22 to 36, was the alleged ringleader, two core members, and an individual working at a watch shop. According to law enforcement, the student was one of the two individuals claimed to be the ringleaders. As of Friday afternoon, the suspects were still in custody. The authorities stated that the investigation was ongoing and there could be further arrests.

In Hong Kong, money laundering is punishable by up to 14 years in prison and a fine of 5 million HKD.

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