Hong Kong police recently smashed a huge money laundering operation that processed a whopping $15 million USD through over 550 bank accounts and cryptocurrency transactions. Twelve people, aged 20 to 40, were arrested in raids across Hong Kong and mainland China. They’re facing charges for conspiracy to launder money.
How the Scheme Worked
The gang hired people from mainland China to open tons of dummy bank accounts (also known as “shell accounts”). These accounts received money from various scams. The recruits then withdrew cash using different ATM cards and sent it to cryptocurrency exchanges. The money was then converted into crypto and mixed with other transactions to hide its origins.
The Mong Kok Base
Investigators say the group ran their operation from an apartment in Mong Kok, Hong Kong, starting mid-2024. This apartment housed the mainland recruits who processed the dirty money daily. Police raided the apartment and found HK$600,000 in cash and a bunch of bank documents.
Following the Money
Police followed two key members of the gang from the apartment. They watched as one went to a bank and the other used an ATM, before both headed to a crypto exchange in Tsim Sha Tsui. The police swooped in, seizing around HK$770,000 in cash. In total, the raids netted about HK$1.05 million, plus other currencies, over 560 ATM cards, and several phones.
The Scale of the Fraud
Police linked over HK$10 million of the laundered money to 58 separate fraud cases. Fraud is a huge problem in Hong Kong; it went up over 12% in 2024, with over 10,000 arrests. Shell accounts were involved in over 70% of those arrests, and fraud now makes up almost half of all criminal cases in the city.
The Call for Tougher Penalties
Police are pushing for harsher penalties for money laundering. They point out that people often lend their bank accounts to criminals, sometimes without even knowing it. While the maximum sentence is 14 years in prison and a HK$5 million fine, many convicted launderers only get a few extra months added to their sentences.
