Hong Kong police initiated an investigation on November 25th into the cryptocurrency market company Hounax, after 131 individuals claimed to have lost a total of 120 million HKD (15.4 million dollars). This process occurs during a period when regulatory actions in the cryptocurrency market are increasingly intensifying.
According to a report by South China Morning Post, the Hong Kong police announced on November 25th that they had started an investigation into fraud allegations and promised that arrests would be made in the coming days. Among the victims is a 69-year-old retired woman, with victims’ ages ranging between 19 and 78, having lost a total of 12 million Hong Kong dollars.
Inspector Chan Wai-kei of the Commercial Crime Bureau told local media that the fraudster convinced people to invest in the cryptocurrency market through a platform, but investors discovered they had been defrauded when they attempted to withdraw their money.
Earlier this month, the Hong Kong Securities and Futures Commission (SFC) had listed Hounax as a suspicious crypto asset platform. The SFC stated on its website that the company claimed to cooperate with a financial institution and a venture capital firm, but this was not reflective of the truth.
Hong Kong legislator Johnny Ng suggested in an interview with Now com on November 27th that the SFC needs to engage with unlicensed crypto trading platforms to identify problematic firms at an early stage and reduce risks in the cryptocurrency market. The investigation into Hounax by the Hong Kong police follows the probe into the crypto trading platform JPEX in September. As of November 26th, the Hong Kong Economic Journal reported that local police had received reports from about 2,623 victims, amounting to approximately 1.6 billion Hong Kong dollars, and so far 66 individuals have been arrested.