Authorities in Hong Kong have indicted 16 people believed to be linked to the JPEX cryptocurrency scam, which led to the loss of $205.8 million. These individuals, including former lawyer and social media influencer Joseph Lam, are accused of defrauding over 2,700 investors.
JPEX Scam Affects 2,700 Investors
According to Hong Kong police, the JPEX cryptocurrency scam, which affected 2,700 investors, is alleged to be the largest financial fraud in the country's history. The exchange allegedly operated as a crypto trading platform without a license, misleading investors into believing it was a legitimate exchange.
Hong Kong authorities discovered discrepancies in its operations and opened a case in September 2023. Since then, approximately 80 people have been arrested and HK$228 million seized. More recently, authorities charged 16 individuals for their involvement in the matter.
Court Hearing Scheduled for November 6
The charges against the 16 individuals include conspiracy to defraud, fraudulently inducing investment, and money laundering. They are scheduled to appear before the Eastern Court on November 6.
Of the 16 suspects, six are believed to be core members of JPEX’s operations. Lam and six others were categorized as influencers or believed to be involved in Over-the-Counter (OTC) crypto trading.
This marks the first time Hong Kong authorities have applied the Anti-Money Laundering (AML) and Counter-Terrorist Financing Ordinance to a crypto-related case. Following this case, Hong Kong leader John Lee has called for "more public education for investors to know the risks" and requested a licensing regime in the territory.
Hong Kong's Push to Become a Global Crypto Hub
This development underscores Hong Kong's dedication to becoming a major crypto hub. In June, authorities rolled out their digital asset policy blueprint, "LEAP," which places a strong emphasis on stablecoin oversight and the tokenization of real-world assets (RWAs).
The LEAP initiative focuses on Legal clarity, Ecosystem development, Application of real-world use cases, and Promotion of talent. Recently, the Hong Kong Monetary Authority (HKMA) reiterated its ambitious plan to make the region a global hub for tokenization and financial innovation. The Fintech 2030 strategy outlines a roadmap to strengthen the city’s fintech ecosystem over the next five years.