Hong Kong police have dismantled a cross-border money laundering ring that processed around $15 million, or HK$118 million, using cryptocurrency and over 550 fraudulent bank accounts.
Twelve suspects aged between 20 and 40 were arrested across various Hong Kong and mainland China districts. All of them now face conspiracy charges related to money laundering activities.
The syndicate used crypto platforms and local banking systems to move large sums of illegal funds obtained from fraud cases.
Seizures reveal scope of operation
Officers recovered HK$1.05 million in cash during the raids, worth about $134,000. Authorities also seized over 560 ATM cards, several mobile phones, and stacks of bank records. Investigators found that the group actively recruited individuals in mainland China to open shell bank accounts. These accounts were then used to receive and transfer funds linked to online scams and other fraudulent activities.
Superintendent Shirley Kwok Ching-yee stated that the recruits used multiple cards to withdraw cash, which was then transferred to virtual asset exchanges. The funds were converted into cryptocurrency before being laundered through various platforms. The group operated out of a rented apartment in Mong Kok, which served as the base for carrying out the laundering process.
Surveillance leads to syndicate leaders
Chief Inspector Lo Yuen-shan confirmed the operation had been running from the Mong Kok apartment since mid-2024. Recruits lived there while handling the financial transactions. Police tracked two key figures from the apartment, catching one inside a bank and the other withdrawing cash from an ATM. Both were followed to a crypto exchange store in Tsim Sha Tsui, where authorities seized HK$770,000 in cash, approximately $98,000. Further arrests were made following coordinated raids across the city.
Investigators linked HK$10 million of the laundered funds, or about $1.2 million, to 58 separate fraud cases.
Rising fraud prompts call for tougher laws
The Commercial Crime Bureau reported a surge in fraud-related cases across the city. Senior Inspector Tse Ka-lun said that many criminals use the bank accounts of friends or relatives to disguise the flow of illicit money. Penalties for money laundering in Hong Kong currently include up to 14 years in prison and a maximum fine of HK$5 million. Over the past two years, more than 100 convicted individuals received extended sentences of three to 18 months.
In April, it was announced that the Securities and Futures Commission requires crypto exchanges to receive written permission before offering staking services. They must also be clear about the costs, risks, how to withdraw your assets, and how your crypto is safeguarded.