Hong Kong authorities have filed formal charges against 16 people for the JPEX fraud, valued at $205.8 million (HK$1.6 billion). The charges in the Hong Kong JPEX case mark a milestone in one of the city’s largest financial frauds. Chief Superintendent Ernest Wong Chun-yue, of the commercial crime bureau, confirmed the charges, which involve 2,636 victims registered as of February.
Local police have charged six principal members, seven promoters, and three others. They are accused of conspiring to lure Hong Kong residents into virtual asset investments before stealing and laundering their funds. To date, authorities have made 80 arrests in total and have frozen assets worth HK$228 million. These assets include HK$14.5 million in cryptocurrencies, plus real estate, luxury vehicles, and bank funds. Furthermore, Superintendent Wong confirmed that Interpol is actively searching for three fugitives, including two ringleaders of the operation.
Can the SFC’s new regulation prevent future collapses like JPEX?
This is the first time charges of this magnitude have been filed under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance. Those involved face accusations of fraudulently or recklessly convincing others to invest. Convictions can carry fines of up to HK$1 million and seven years in prison. The Securities and Futures Commission (SFC) was key in exposing that JPEX falsely claimed to be seeking regulatory approval, when no formal application ever existed.
Following the scandal, Hong Kong is tightening its grip on crypto licensing. Chief Executive John Lee Ka-chiu endorsed the SFC’s transparency in publishing lists of approved and applicant companies. Likewise, authorities are collaborating to improve education on safe trading and investment practices. The SFC also introduced stricter custody requirements for platforms, seeking to protect investor assets. Moreover, the Hong Kong Monetary Authority (HKMA) has debunked rumors about unauthorized stablecoins, reiterating the need for regulatory authorization.
The 16 defendants, including former barrister Joseph Lam Chok and promoter Chan Wing-yee, face additional money laundering charges. The group will appear in Eastern Court this Thursday. The case has also had repercussions in Taiwan, implicating singer Nine Chen for allegedly receiving funds to promote JPEX. These charges in the Hong Kong JPEX case demonstrate the regulators’ seriousness in cleaning up the virtual asset sector and protecting investors.
