Hong Kong Authorities Confirm 145 Victims and Nearly $19 Million Lost in Crypto Scam
Recently, authorities in Hong Kong have verified that 145 individuals have filed complaints about losses from an unlicensed cryptocurrency exchange called Hounax. The total amount lost is approximately $18.9 million. Earlier this month, the Hong Kong Securities and Futures Commission (SFC) warned users about the suspicious trading platform, which falsely claimed to have licenses and backing from legitimate financial institutions.
Details of the Hounax Crypto Scam
During a press conference on November 25th, Hong Kong police disclosed that as of November 27th, 18 people had reported losses ranging from $1,539 to $1.2 million HKD (Hong Kong dollars). Hounax recruited unsuspecting crypto traders through social media and messaging apps, promising high returns on investments made through their app.
According to inspectors, once victims transferred funds to Hounax, the money was immediately taken away. Withdrawal attempts were either rejected or met with demands for verification fees up to 80% of the original funds.
Over $18.9 Million in Losses Reported
The total reported losses from all 145 Hounax users now amount to around 148 million HKD, equivalent to $18.9 million USD. The victims range in age from 19 to 78 years old. The largest individual loss was suffered by a retired woman aged 69 who was scammed out of $1.54 million HKD, nearly $135 thousand USD. None of the victims had any physical contact with the Hounax scammers.
Hong Kong Focuses Efforts on Curbing Unlicensed Exchanges
In response to these troubling events, Hong Kong regulators are determined to tighten oversight of cryptocurrency trading platforms to prevent further incidents. Last month, the SFC published a warning list of suspicious crypto exchanges, including Hounax. Although the one-year grace period for platforms to register with Hong Kong regulators will remain unchanged, officials emphasize the need to accelerate efforts in identifying unlicensed businesses that falsely portray themselves as legitimate.
Hot Take: Law Enforcement and Regulators Crack Down on Crypto Scams
The Hounax crypto scam in Hong Kong is yet another example of the dangers posed by unlicensed cryptocurrency exchanges. With 145 victims and nearly $19 million lost, it is clear that urgent action is needed to protect investors and maintain trust in the crypto industry. Authorities must continue their efforts to identify and prosecute those responsible for these scams, while regulators work to implement stronger frameworks for governing crypto markets. Striking a balance between innovation and consumer protection is crucial in this rapidly evolving landscape. As the crypto industry grows, it is imperative that users remain vigilant and cautious when engaging with new platforms and investments.
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