Hong Kong has recently seen a worrying increase in fraudulent cryptocurrency schemes, with victims losing significant amounts of money. In one such instance, a 55-year-old resident lost nearly HK$7 million (approximately $900,000) after falling prey to an online crypto investment scam. Unfortunately, cases like these have become alarmingly frequent, with a study estimating that Hong Kong investors lost around $50 million during the first half of 2022 due to such nefarious activities.
How Scammers Operate: A Hong Kong Case Study
In the case above, as the South China Morning Post reported, the scam began when the perpetrator contacted the victim on Instagram in January of this year. Later, they shifted their conversation to another messaging application, where the fraudster gained the victim’s trust.
The scammer then persuaded the victim to create an account on an unknown platform to invest in cryptocurrencies, promising substantial returns on her investment. However, law enforcement officials have since revealed that the information provided by the platform regarding digital asset prices was fake and manipulated by the offender.
The victim was lured into transferring HK$6.96 million ($886,600) across 19 designated bank accounts between February and March. She was asked to pay a fee when she attempted to withdraw some of her funds. Only after attempting to borrow money from her daughter did she realize she had fallen victim to a scam and sought help from the police.
The Legal Consequences: Obtaining Property by Deception
Hong Kong authorities have classified this case as “obtaining property by deception,” a crime punishable by up to ten years in prison. However, no suspects have been apprehended to date.
This incident is not an isolated example. Another recent case involved a 44-year-old woman who reported losing $3.1 million after investing in the stablecoin Tether (USDT) on a suspicious platform.
Data from 2022 revealed that Hong Kong experienced over 10,000 cyber attacks between January and June, with 798 of these incidents being crypto-related schemes that drained approximately $50 million from investors. In comparison, losses from such crimes amounted to $21 million in the first half of 2021.
The police have also disclosed that the total number of crypto scams in China’s special administrative region surged to 2,336 by the end of 2022, marking a 67% increase compared to 2021. However, law enforcement agents have managed to address 1,884 of these cases.
Staying Vigilant in a World of Digital Deceit
As the number of cryptocurrency scams continues to grow, investors must remain cautious and vigilant when dealing with online investment opportunities.
By staying informed and aware of potential risks, individuals can better protect themselves from falling victim to malicious schemes that threaten their financial security.
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