According to local media reports, a 55-year-old woman living in Hong Kong has fallen victim to an online cryptocurrency investment scam and lost her entire savings worth nearly HK$7 million (almost $900,000).
Unfortunately, cases of such fraud especially related to crypto have become quite frequent in the region lately. A study stated that investors residing in Hong Kong had lost around $50 million during the first half of last year due to fraudulent and bogus crypto schemes.
Sources reveal that it all started in January this year when the woman was approached by a random profile on Instagram. The accused texted the victim on her social media profile as per the investigation they later switched platforms and started chatting on another messaging application.
After gaining her trust, the scammer advised and persuaded her to set up an account on an unfamiliar platform to invest in cryptocurrencies with the promise of great returns. As highlighted by the law enforcement agents, the information shared on the venue regarding the prices of digital assets was counterfeit and controlled by the offender. The police said:
She [the victim] was told she would be paid a daily interest of HK$2,500 in addition to a guaranteed profit of tens of thousands of US dollars.
The investigation reveals that the accused persuaded the victim to transfer a total of HK$6.96 million ($886,600) in portions between February and the end of March into 19 designated bank accounts.
One day, when the woman attempted to withdraw a portion of her funds from her account, she was requested to pay a fee. Till this time, she didn’t realize she had fallen prey to fraud and even tried to borrow money from her daughter.
Eventually, she realized the situation and went to seek help from the police, which classified the case as “obtaining property by deception.” The act is listed as a crime and the victim is liable to a punishment of up to ten years in prison. However, as of now, no arrests have been made in the case considering the fake information used in the social media profile and the anonymity maintained.
Unfortunately, this is not the only case of a major crypto scam in Hong Kong this week. A few days ago, a 44-year-old woman called the police claiming she lost about $3.1 million after investing in the stablecoin Tether (USDT) on a dubious platform.
While the growing frauds and scams have been a concern for regulators across the globe, there has been a significant increase in Hong Kong. Data from 2022 revealed there had been more than 10,000 cyber attacks in Hong Kong between the beginning of January last year and the end of June. 798 of them were crypto-related schemes that drained around $50 million from investors. In comparison, such crime accounted for $21 million of losses in the first half of 2021.
The police recently announced that the total number of crypto scams in the region has surged to 2,336 by the end of 2022 which was about 67% more than the 2021 incidents. Reportedly, law enforcement agents coped with 1,884 of the cases. Considering the increasing threat, the authorities who envisioned the region to be a crypto hub have revealed their intentions to regulate the decentralized finance (DeFi) sector.