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Scams and swindles

Police smash Hong Kong fraud syndicate with arrest of 11 over romance, investment scams totalling HK$4 million

  • Cases stretched over 18 months with at least 24 victims, most of whom are under 30
  • Women in the racket believed to have supplied voices for fake social media accounts luring men
PUBLISHED : Sunday, 18 November, 2018, 9:15pm
UPDATED : Sunday, 18 November, 2018, 9:15pm

Eleven members of a Hong Kong fraud syndicate were arrested in an undercover police operation last week after victims lost about HK$4 million in online romance and investment scams stretching back to last year.

The month-long police operation, called “Jetblast”, led to the arrests of seven men and four women, aged 19 to 56. On Friday, officers seized HK$1.4 million worth of items ranging from cars and phones to luxury clothes and handbags.

Police said they believed they had shut down the organisation, which has duped at least 24 victims. “We have successfully dissolved an online investment fraud syndicate,” Acting Chief Inspector Billy Ho Yiu-chung of the New Territories North Region squad said.

“Police arrested four ringleaders including two involved in romance scams, two in charge of investment frauds, two bank account holders and others.”

The group, which started its operations 1½ years ago, was believed to have split into two branches, targeting distinct victim types.

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For romance scams – in which men were the targets – the syndicate would create fake social media accounts featuring pictures of attractive women to lure their victims.

“The scammers will use social media platforms or apps and open new accounts using seductive photographs as profile pictures to draw in male victims,” Ho said. “Once they build up rapport and are able to establish trust, they will recommend an ‘investment expert’ to them.”

The scammers will use social media platforms or apps and open new accounts using seductive photographs as profile pictures to draw in male victims
Billy Ho, acting chief inspector

He said the roles of some of the women arrested were to lend voices for recordings or phone calls to convince victims they were talking to the parties portrayed on social media.

Once the bait was taken, the “financial experts” would then persuade them to hand over savings or take out loans to put into high-return investment products.

In the investment scams, lures touting “low-risk, fast money” schemes were planted in job search forums to attract jobseekers looking to make a quick buck.

Fraudsters came up with the story of “money men” from mainland China and Macau looking to find “legs” to help them bypass cross-border capital controls and channel funds into the city.

Victims were told to take out loans from a financial agency for them in return for about 10 to 20 per cent commission. They were given guarantees that the “money men” would help them settle the loans.

In total, the group managed to bag about HK$3.7 million from at least 12 men and 12 women aged 19 to 41, over about 18 months.

Occupations of victims ranged from cooks, drivers and students to construction workers and clerks, and most were below the age of 30, Ho said. Losses spanned a few thousand to more than HK$500,000.

“A feature of the syndicate was that they would use victims’ personal details for a credit assessment to gauge their borrowing capacity and decide how much effort to spend on them,” Ho said.

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“For those with high borrowing capacity, fraudsters would actually pay them some commission first to convince them to take out bigger loans later. Those with low ability would be asked to use credit cards to buy electronics and resell them for cash.”

Acting Superintendent Lam Sze-yi highlighted an increasing trend in fraud cases on social media.

“In 2017, there were 235 cases involving HK$180 million. In the first three quarters of 2018, the numbers already hit 463 with losses valued at HK$400 million,” she said.

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Chief Inspector Law Suk-man urged Hongkongers to be alert when using social media, especially when handling requests for financial transactions, and to check with professionals or regulatory agencies when faced with uncertainty over high-risk financial products.