Hong Kong To Publish List of Suspicious Crypto Platforms Following JPEX Scandal

Updated: 25 September 2023

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Hong Kong’s financial regulator will publish a list of suspicious crypto firms as it steps up efforts to rein in renegade operators in the wake of an alleged fraud at JPEX.

The Securities and Futures Commission said in a Sept 25 statement that it will also put in place a series of measures to reinforce information dissemination and investor education. It plans as well to publish a list of all licensed, deemed licensed, closing down, and virtual asset trading platforms (VATPs) applicants, following public demand.

SFC’s New Measures to Combat Unregulated Crypto Trading in Hong Kong

🚨 Hong Kong Takes Action on Crypto After JPEX Scandal 🇭🇰

Hong Kong's financial regulator, the Securities and Futures Commission (SFC), is on a mission to protect investors. They'll publish lists of licensed, closing-down, and suspicious crypto trading platforms. 📋🔍

This move…

— BuzzBeatHQ (@mely_buzz) September 25, 2023

The SFC’s campaign to educate the public “will further enhance investor education by various means, such as mass media, social media, and educational talks, facilitating the public’s understanding of the risks associated with VAs and potential fraud,” it said.

The new measures are being put in place after the ongoing probe against JPEX. The unregulated crypto exchange is currently being accused of deceiving its customers and causing over 2,300 investors to lose almost HK$1.43 billion (US$182 million), making it one of the largest fraud case in Hong Kong history.

The incident is a setback for the government’s efforts to establish itself as one of the world’s leading crypto hubs.

Orchestrators Still On The Run

Despite the arrests of 11 people who were detained for questioning in connection with the JPEXl, Hong Kong police say those at the centre of the exchange’s operations remain at large.

https://twitter.com/Fencingbanana/status/1705750880912630222

Among the 11 currently in police custody is crypto influencer Joseph Lam Chok, who has recently made repeated steps to publicly dissociate himself from the exchange and even encouraged victims to file complaints of their losses with the police.

The police have also detained two YouTube stars, Chan Wing-yee and Chu Ka-fai, who had previously collaborated with JPEX to promote their offerings to their followers despite the exchange being unlicensed.

Three workers of the JPEX Technical Support Company, the company’s only director, Kwok Ho-lun, a restaurant manager, three famous people who allegedly once promoted JPEX in some way have also been detained for questioning.

The Hong Kong police are still conducting investigations and, according to reports by local media, more arrests are to be anticipated.

After noticing questionable cryptocurrency transfers coming from the JPEX exchange, the Hong Kong police have also reportedly requested assistance from Interpol and other international law enforcement organizations, says a source of the local media.

The pursuit against the JPEX exchange publicly began on September 13, despite the authorities having an eye on the company since last year. According to Christopher “Kit” Wilson, director of enforcement at the SFC, JPEX was placed on the alert list in July 2022, due to “evasive” behavior from stakeholders and unsatisfactory responses to requests for information, says Cointelegraph.

The SFC has since been conducting investigations that escalated to the current situation in April after the regulators received their first official investor complaint against the exchange, with the Anti-Money Laundering Ordinance (AMLO) being involved in June.

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