Police smash money laundering racket that allegedly used Hong Kong Jockey Club accounts

Gang suspected to have preyed on loan-sharking victims who could not pay off their debts

PUBLISHED : Friday, 06 January, 2017, 2:56pm
UPDATED : Friday, 06 January, 2017, 11:24pm

Seven people have been arrested and more are expected to follow, after Hong Kong police dismantled a money laundering racket that allegedly handled more than HK$7 million over the past 18 months.

Police sources said the money, believed to be raised through loan sharking activities, had been laundered through three Hong Kong Jockey Club accounts since mid-2015.

“Police are investigating whether the gang was involved in loan-sharking activities after a list of more than 100 debtors was seized during the operation,” one source said.

One debtor, who borrowed HK$2,000, was given HK$1,300 after HK$700 was deducted as interest. He was required to pay 10 per cent of the debt amount in interest every 10 days.

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“The interest rate is more than 360 per cent a year. It is well above the legal limit of 60 per cent. The loan amounts were small but they snowballed on extortionate interest rates,” the source said.

“Those who failed to make payments usually received nuisance calls or threats, and their homes daubed with red paint.”

Three of the gang’s core members, who were suspected to have Sun Yee On triad links, were picked up in To Kwa Wan on Wednesday night.

Officers seized HK$60,000 and four Jockey Club account cards from the men before they were taken to a nearby flat where police found another HK$170,000, three more account cards, accounting records and a list of debtors.

Inside the flat, police arrested the 34-year-old wife of one of the alleged core members.

The following day, police nabbed another couple and a man who were believed to be victims of the gang’s operations and whose Jockey Club accounts had been used to launder money after they failed to repay debts.

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All seven suspects were arrested on suspicion of money laundering and were being held for questioning. They have not been charged. A police source said they were likely to be released on bail as officers needed more time to gather evidence.

Senior inspector Lo Man-fai of the Kowloon East regional crime unit, said an investigation was in progress and it was possible further arrests would be made.

The money laundering racket was uncovered following an investigation into illegal debt collection across the city, Lo said.

Money laundering is a serious offence, carrying a maximum penalty of 14 years jail and a HK$5 million fine.