Cryptocurrencies are widely used in money laundering operations because of the difficulty in tracking their transactions, especially privacy currencies such as: Monero.

In a recent news report,SCMPIt is reported that the Hong Kong authorities have arrested four people in connection with a fraud scheme and a money laundering operation.

The suspects have reportedly laundered a whopping 1.2 billion Hong Kong dollars (150 million US dollars) that was transferred through Singapore bank accounts over the past 15 months.

Exactly last week on July 8, Hong Kong Customs launched an operation dubbed “Coin Breaker”.

Mark Wu Wai Kwan, Hong Kong Customs Chief Superintendent, said:

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It is the first time in Hong Kong that a money laundering ring involved in using cryptocurrencies to launder dirty money and conceal the source of criminal assets has been dismantled.

Wai Kuan also noted that the nature and implementation of the fraud made it more difficult to track down, as the alleged mastermind behind the operation was controlling three fake companies to launder this money.

After tracking the activities of these companies, authorities froze HK$20 million in suspicious bank accounts believed to be part of these criminal proceeds.

Fifteen months fraud and money laundering:

The gang behind this scam has been running since February 2020.

Speaking to the aforementioned source, Senior Supervisor told Wu the following:

The three gang members were recruited by the head of the gang with financial rewards, and each received between HK$10,000 and HK$20,000 per month.

Besides, the shell companies opened three accounts containing e-wallets through a local cryptocurrency exchange.

Where they resorted to digital currencies of a privacy nature to exchange them for the tether coins they owned.

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Privacy Coins were used to participate in these transactions, as much as 40 accounts from different accounts.

The gang then cashed these cryptocurrencies into eight accounts owned by the three shell companies.

According to the previous source, 3-5% commission was offered to criminal customers for laundering their money.

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A total of 880 million HK dollars were laundered in digital currencies.

The remaining 350 million Hong Kong dollars were laundered through traditional methods.

Cryptocurrency scams are on a sharp rise in the wake of the cryptocurrency market boom this year.

Last month, the founder of the popular South African trading and investment platform Africrypt escaped with more than $3 billion worth of bitcoin.

Similarly, the UK’s financial regulator, the FCA, disclosed a multi-million dollar crypto scam last week.

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