Hong Kong Police crackdown on cryptocurrency scam involving counterfeit currency

Authorities
in
Hong
Kong
have
flagged
a
surge
in
counterfeit
banknotes
brought
into
circulation
via
cryptocurrency
scams.

According
to
a

local
report,
the
Hong
Kong
police
seized
3,396
fake
notes
between
January
and
April
2024.
The
counterfeits
amounted
to
a
total
face
value
of
HK$2.55
million,
approximately
$326,130.

Specifically,
just
three
cryptocurrency
scams
and
frauds
have
been
responsible
for
a
big
chunk
of
these
fakes
in
circulation.

One
such
case
saw
a
fraudster
set
up
a
bogus
cryptocurrency
for
a
cash
counter
in
Tsim
Sha
Tsui.
An
unsuspecting
woman
fell
victim
to
this
scammer
when
she
exchanged
HK$1
million
in
Tether’s
USDT
stablecoin.
The
scammer
got
away
with
the
crypto
funds,
and
the
woman
was
left
with
fake
HK$1,000
notes.

Another
person
was
robbed
of
HK$1
million
via
a
similar
tactic,
with
the
fraudster
getting
away
with
the
man’s
USDT.

Per
the
recent
report,
the
Hong
Kong
police
have
seized
1,693
“training
notes”
and
347
low-quality
counterfeit
bills
tied
to
these
scams.
Training
notes
are
employed
to
train
bank
staff
and
closely
resemble
the
actual
currency.

The
police
have
arrested
three
individuals
in
connection
with
these
scams.
The
funds
have
been
seized.

Earlier
this
year,
the
Hong
Kong
police

also
apprehended
3,000
hell
banknotes,
a
safe,
and
a
note-counting
machine
from
a
cryptocurrency
exchange
shop
in
the
same
Tsim
Sha
Tsui
region.

Hell
banknotes
are
used
in
traditional
Chinese
rituals
as
offerings
to
ancestors
or
deities.
These
closely
resemble
real
currency.

As
of
now,
the
authorities
have
asked
the
public
to
hand
over
counterfeit
notes
to
the
police
or
risk
committing
“the
offense
of
passing
counterfeit
notes.”

Recently,
the
Hong
Kong
police
have
also
noticed
a

significant
uptick
in
cryptocurrency-related
crimes.
Crimes
involving
cryptocurrencies
have
surged
from
2,336
cases
to
3,415
in
a
year.

A
whopping
$553
million
worth
of
funds
have
been
lost
as
a
result.

The
scams
primarily
consisted
of
two
different
tactics.

In
the
first
scenario,
scammers
would
try
and
convince
victims
to
transfer
funds
to
their
wallets.
This
is
typically
seen
in
the
case
of

pig
butchering
scams.

The
scammers
also
reportedly
use
overseas
crypto
exchanges,
further
complicating
the
tracking
process,
as
reported
by
the
authorities.

The
other
scenario
involved
scammers
relying
on
the
hype
around
cryptocurrencies.
With
cryptocurrencies
becoming
a
hot
topic
in
finance,
scammers
often
leverage
the

lack
of
understanding
of
their
victims
to
defraud
them.
This
surge
in
crypto
crimes
in
the
region
has
spurred
increased
scrutiny.
Hong
Kong’s
securities
regulator
has
set
up
a
licensing
regime
for
crypto
service
providers.

On
the
other
hand,
Chinese
authorities
have

pledged
to
work
with
the
United
Arab
Emirates
(UAE)
in
a
bid
to
combat
cyber
crimes.