Hong Kong police have started releasing crypto fraud information to raise awareness in the general public as a part of the “Operation Anti-Fraud Shield” initiative of the Eastern District police. The operation is aimed at increasing awareness of crime and scam prevention in the general population. Crypto fraud cases are on the rise in Hong Kong, and have a fast-growing trend. As per authorities, the scammers are making around USD 2.5 million every day from Hong Kong-based victims.
Launch of Operation Anti-Fraud Shield
In Hong Kong, fraud incidents are common and the ‘Big Four’ fraud activities are online shopping fraud, investment fraud, job-seeking fraud, and telephone fraud. The Eastern District Police District has begun a new cycle of the “Anti-Fraud Shield” and issued a monthly magazine outlining frequent fraud incidents and dismantling criminals’ strategies in order to enhance public knowledge of fraud prevention. The first edition of this issue concentrates on a recent virtual currency investment fraud.
The Anti-Fraud Shield program comprises weekly anti-fraud WhatsApp messaging, as well as outreach activities involving police district managers, frontline officers, and community leaders, in addition to the distribution of the monthly newsletter. If members of the public have any reservations, they should phone the police hotline.
USD 1 million fraud with engineer
The fraud incident is of an engineer who was reportedly cheated by crypto fraudsters to the tune of over USD 1 million. The victim went to a police station on July 23 to submit a case, claiming that he had been targeted by other users of the social media and messaging app platform WeChat which led him to a bogus virtual currency investment product. It promised him large returns on investment. The platform was looking quite guanine. According to the engineer, he created an account on the site and deposited 28 tether (USDT) into it. At first, the victim seemed to assume that his investments are growing as the platform’s interface indicated that he was profiting. However, things quickly turned sour when he sought to withdraw his money, he was ordered to pay a large processing charge. His investment account then was immediately closed, and the funds he deposited were lost.
According to the authorities, the platform eventually turned out to be multiple proxy accounts maintained by the scammers over the period of 10 days in July. In recent years, scams utilizing USDT and other USD-pegged stablecoins have increased in both Hong Kong and Mainland China.
Reasons for increasing fraud activities in Hong Kong
Recently, with China’s crackdown on cryptocurrency, bitcoin (BTC) exchanges have become extremely difficult to access, despite relatively strong levels of demand for BTC. As a result, Mainland-based traders have been increasingly eager to get USDT and other stablecoins in order to purchase bitcoin through over-the-counter (OTC) marketplaces. This has resulted in an increase in USDT-related activities in Hong Kong and other Asian locations, as well as an increase in USDT-themed frauds. As per estimates, the average sum involved in a Hong Kong fraud case is around 17 million yuan.