Hong Kong authorities have dismantled a crypto fraud syndicate that allegedly used counterfeit currency to deceive victims out of digital assets valued at over HK$11 million (approximately $1.4 million).
Chief Inspector Lo Yuen-shan announced on Sunday that four individuals, including a 14-year-old, have been arrested on charges of conspiracy to defraud and possessing and using 5,000 counterfeit banknotes. The suspects were apprehended on Friday at a self-storage facility in Mong Kok, where the fake currency was being kept.
According to police, the fraud syndicate operated with a clear division of roles. Two key figures were responsible for procuring the counterfeit banknotes and establishing a fake online cryptocurrency exchange to attract unsuspecting users. The other two suspects handled the retrieval of the fake money from the storage facility and transported it to the masterminds, who had set up a nearby store to create the illusion of a legitimate business operation.
The perpetrators impersonated well-known cryptocurrency investors, enticing victims with offers to purchase digital assets at prices above market value. Victims were then invited to the store to view the “cash” and instructed to complete the transaction online. Once the transaction was finalized, the fraudsters quickly transferred the digital assets to a different account and refused to fulfill their end of the deal, leaving the victims without their assets.
The suspects face potential penalties of up to 14 years in prison, the maximum sentence in Hong Kong for producing, circulating, and using counterfeit banknotes.
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