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Hong Kong Arrests 13 in HK$53 million Money Laundering Case

Richard Marley
June 28, 2021
3 minutes read
101

13 people in Hong Kong have been arrested for money laundering and operating illegal gambling sites and betting schemes.

Authorities in Hong Kong and mainland China have arrested 13 individuals for their involvement in a money laundering scheme worth HK$53 million (USD 6.8 million). The criminals were allegedly tricking jobseekers into handing over Personally Identifiable Information (PII).

City Police have seized identity details, bank cards and documents of more than 100 citizens that are thought to be used by the criminal gang for laundering money. From those arrested, a total of HK$1.62 million in assets have been frozen. The accused are also being charged for helping to run illegal betting websites.

Cheng Lai-ki, who is a Senior Superintendent of Commercial Crime Bureau, stated that authorities from both sides of the border conducted a 3-day-long operation to arrest the members of the criminal gang.

13 arrested over HK$53 million money-laundering scheme in Hong Kong, mainland China that preyed on jobseekers https://t.co/CAw8UxQirq

— SCMP Hong Kong (@SCMPHongKong) June 27, 2021

To launder dirty cash, the criminal bank was preying on jobless victims by luring them into false promises of earning easy money. In reality, high paying job promises were being made to gain access to the victim’s personal information. The victim’s information was then used to set up bank accounts to launder illegal money.

Between June 2019 and April 2021, it is believed that the gang laundered criminal proceeds worth as much as HK$53 million.

Hong Kong police arrested 12 men and women during the operation, aged between 20 and 42, some of whom were picked up from a Fo Tan factory building.

The mastermind behind the criminal gang was also arrested, while the criminal gang itself has been dismantled.

Cheng stated that the gang was posting vacancies and “quick money schemes” on social media and job portals. The adverts promised high paying salaries for job seekers with little experience. Once the victim’s data had been acquired, criminals tampered with it outside of Hong Kong to make it harder to trace, stated Cheng.

The Police has also revealed that the gang was operating an illegal gambling website through social media and instant messaging software. They were also partaking in illegal bets on sports, such as horse racing and football, including the ongoing UEFA European Championship.

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Danish Gambling Operator Reports Tipwin to the Police for AML Failings
Then danish gambling operator Spillemyndigheden has reported Tipwin to the police for violating the Danish Money Laundering act

According to the sources, Spillemyndigheden, the government office based in Odense, Denmark, has reported to the police that the business has failed to create risk assessments of retail bets with a lack of written policies on its retail offerings.

It is also worth mentioning that the operator also lacks complete business procedures and controls for the offerings based on land or in regards to money laundering until 25 May 2022.

In the official statement of the regulator to the police, it stated all the shortcomings of Tipwin in compliance with the anti-money laundering standards. It stated: “Spillemyndigheden notes that the rules on risk assessment, policies and business procedures are absolutely fundamental in the Money Laundering Act. By failing to prepare a risk assessment, Tipwin has not had a useful tool that has provided an overview and understanding of where and to what extent Tipwin is exposed to money laundering or terrorist financing, and what measures are in place are necessary to mitigate the risks involved.”

This clearly states that the german based gambling operator, Tipwin is exposed to the illicit crimes of money laundering and terrorist financing and has failed to comply with the AML regulations. The Danish regulator also focused on the lack of preparation from the operator on assessments of risks which are fundamental components of the anti-money laundering act.

Spillemyndigheden also added: “Preparing a risk assessment of the company’s business model is a very fundamental means of limiting the risk of money laundering. Tipwin has thus also not had policies and operational procedures that stem from the risk assessment. By failing to prepare a risk assessment, the Gambling Authority has therefore handed over the case to the police investigation.”

The authority also launched an injunction on the breach of rules and procedures in regard to the online casino and betting operations. With the main emphasis on money laundering, the regulator released a statement last month which reminded businesses in the industry of the obligations. It mentioned the regulations most firms are complied with, which are in order to prohibit the financial interactions with individuals, groups, legal bodies or countries.

In addition, Spillemyndigheden issued a 3 months deadline to Tipwin to sort out the situation.

Suggested Read: Danish Gaming Regulator Sanctions Unibet Over AML Violations

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While Australia’s vulnerability to money laundering and organized crime is obvious, firms that incorporate a robust AML Screening solution can steer clear of both money laundering and regulatory penalties. AML/CFT regulations oblige businesses to identify the ultimate beneficial owners and individuals who perform transactions for corporate customers. The FATF advises businesses to verify the identities of their customers through document verification checks and analyse the risk associated with them.

Shufti Pro’s AI-backed identity verification and Anti-Money Laundering (AML) screening solutions allow financial firms to adopt a risk-based approach. The globally acclaimed company offers services in 230+ countries and territories that ultimately overcomes the data transparency issues identified by FATF. In less than a second, financial organizations can get 98.67% accurate identity verification results.

To learn more about Shufti Pro’s AML Screening solution, get in touch with experts.

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Hong Kong Arrests 13 in HK$53 million Money Laundering Case

Crown and Star Casinos – A Stain on Australia’s Reputation

Australia’s Anti-Money Laundering Regime

How Casinos and Businesses Can Secure their Operations

What Shufti Pro Offers

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