More than US$195.3 million defrauded from companies in Hong Kong and overseas in first 10 months of 2018

  • Figure is a 100 per cent increase on the previous year and affected more than 740 companies
  • The biggest amount swindled was more than HK$100 million, which an electronics company in Spain was defrauded of
PUBLISHED : Sunday, 06 January, 2019, 1:35pm
UPDATED : Sunday, 06 January, 2019, 3:08pm

More than HK$1.5 billion was swindled from over 700 companies in Hong Kong and overseas by international email scammers between January and October in 2018, up 100 per cent on the previous year.

Of the companies affected by such crimes in 2018, 37 per cent were local and the others were companies in Europe, America and Asia.

Figures show Hong Kong police handled 741 cases of commercial email fraud involving total losses of HK$1.53 billion (US$195.3 million) in the first 10 months of 2018.

The amount is double the HK$756 million that was fraudulently acquired from 570 companies in the same period of 2017, and also larger than the HK$992 million for the whole of that year.

The significant rise came as email scammers were found in the first half of 2018 to have used new tactics to gain access to their targets’ sensitive information, such as sending a virus inside an email disguised as a job application with a résumé attached.

In 2018, the biggest loser was an electronics company in Spain which was duped into transferring more than HK$100 million to a bank account in Hong Kong in July.

“The company received a bogus email purportedly sent by the company’s CEO requesting a staff member to transfer over HK$100 million to a bank account in Hong Kong,” a police spokesman said.

The company later realised it was a scam and reported the case to police in Spain, and also in Hong Kong on July 11.

Huge explosion in online scams in 2018, mostly romance-related

A police source said more than 20 bank accounts were used to launder the money, before some of the cash was transferred out of the city. The force’s anti-fraud squad froze HK$60 million of the funds.

The firm was one of 466 companies overseas that fell victim to commercial email scams between January and October in 2018.

Hong Kong police got involved because the swindled money was transferred into bank accounts in the city.

According to police, commercial email fraud usually includes bogus CEO and business partner scams.

“Pretending to be the senior management officers or business partner of victim companies, fraudsters send out fictitious emails to staff, such as accounting officers or managers, claiming that there is a need to transfer money to overseas business partners or make business investments, and direct the staff to transfer funds of the company to the bank accounts designated by fraudsters,” the spokesman said.

Saying that fighting such crimes was a “challenge”, another source said the emails used to cheat the victims were sent from countries in Europe and Africa, but that did not mean scammers operated in those countries.

Police have called on members of the public to be alert to suspicious emails, and to verify the identities of people they are in contact with, and ensure a request is legitimate by telephone, fax or other means before making money transfers.

In Hong Kong, the overall number of fraud by deception jumped to 7,047 in the first 10 months of 2018, up nearly 20 per cent from 5,879 in the same period of 2017.

Number of Hongkongers falling prey to online scams surges 250 per cent

Online romance scams constituted the biggest surge among all cases of deception in 2018.

Internet love scammers conned 463 Hongkongers out of a total of HK$398 million in the first nine months of the year.

The number was a significant increase from the 142 victims in the same period of 2017, involving losses of HK$78.1 million.

A 66-year-old businesswoman was the victim of the city’s biggest romance scam case. She was cheated out of HK$180 million over four years by an “engineer from Britain”. 

The city’s longest-running scam involved a finance manager who lost HK$14 million to a con artist posing as a British film director. Their online relationship lasted eight years, and the victim never met him in person. She sought help from police in April.