HK$100M Money Laundering Syndicate Busted

Hong Kong police announced a significant breakthrough in their fight against money laundering with the arrest of six individuals, including a postsecondary student, allegedly linked to a cross-border syndicate responsible for laundering more than HK$100 million (US$12.7 million) in suspected crime proceeds. The crackdown took place following a meticulous investigation that lasted several months.

The Hong Kong police said that they had captured a gang that used cryptocurrency to launder money. The core member was a student, and the funds involved exceeded US$10 million. He could be sentenced to a maximum of 14 years in prison and a fine of HK$5 million. SCMP reported.…

— Wu Blockchain (@WuBlockchain) July 16, 2023

Syndicate’s Tactics in Cross-Border Investigation

The investigation, initiated in late April after intelligence reports, prompted Hong Kong police to collaborate with their counterparts in mainland China to tackle the sophisticated syndicate. Led by Senior Inspector Chu Ming-man of the Hong Kong Island anti-triad squad, the joint operation uncovered the syndicate’s modus operandi.

According to the police, the group set up bank accounts in mainland China to collect crime proceeds obtained through various fraudulent schemes. These illicit funds were then funnelled into Hong Kong, where the syndicate members employed debit cards to purchase valuable items like gold ornaments and watches. The proceeds from the resale of these valuables were subsequently converted into digital coins, a manoeuvre designed to conceal the origins and flow of illegal funds.

Inspector Chu emphasized the organization’s well-organized structure and their use of multilayered tactics to thwart police investigations. The illegal digital coins were ultimately transferred to e-wallet accounts overseas, further complicating detection and making it difficult for law enforcement to trace the funds.

During the series of raids conducted across the city on Thursday, officers arrested five men and one woman, aged between 22 and 36, suspected of being part of the syndicate. Among them, the postsecondary student was identified as one of the core members responsible for facilitating the laundering of crime proceeds using e-wallet accounts to trade cryptocurrencies. The suspects are currently in police custody on charges of conspiracy to launder crime proceeds and defraud. Law enforcement officials have seized over HK$1 million in cash and an array of valuables, including watches and gold ornaments, along with several debit cards linked to the illegal activities.

As the investigation continues, Senior Inspector Chu issued a warning to the public, especially young individuals seeking summer jobs, to exercise caution and be vigilant about the nature of their employment opportunities. Additionally, merchants were advised to be cautious when customers make multiple purchases of the same item or frequently use different debit cards for payment, in order to prevent unknowingly facilitating illicit activities. Money laundering in Hong Kong carries a severe penalty of up to 14 years in jail and a HK$5 million fine. Authorities continue to remain vigilant against such criminal operations and are committed to taking decisive action against those involved in illicit financial activities.