Hong Kong’s Secretary for Security, Chris Tang Ping-Keung, has pledged to intensify efforts to apprehend the mastermind behind the controversial crypto exchange JPEX. The crackdown follows a series of enforcement actions against JPEX, including a police directive instructing telecom companies to block access to the exchange’s website and mobile app.
The JPEX scandal began when the Securities and Futures Commission (SFC) received over 1,400 complaints against the exchange regarding fraud, withdrawal freezes, and declining wallet balances. The SFC noted that JPEX promoted its services and products to the Hong Kong public through online celebrities and over-the-counter money changers.
As the issues with JPEX became public, many users found themselves unable to withdraw their funds, while others complained about reduced wallet balances. In response to the Hong Kong watchdog’s warning, JPEX reportedly increased its withdrawal fee to $1,000 to discourage users from withdrawing their assets.
The Hong Kong police have since arrested influencer Joseph Lam (Lin Zuo) for his association with JPEX. So far, 2,392 victims have filed complaints about the JPEX exchange with the police, leading to the arrest of 12 individuals and the seizure of assets worth HK$77 million and over HK$8 million in cash.
Hong Kong Ready to Tighten Crypto Regulations
The Secretary for Security affirmed that the police would “by all means hold the culprits accountable for their crimes,” noting that they were actively engaging relevant individuals connected to the alleged conspiracy to defraud case.
In light of these events, Hong Kong regulators are looking to tighten regulations around the crypto market. The government plans to increase its efforts to inform investors and remind them only to utilize platforms granted Securities and Futures Commission licenses.
The regulatory authority is currently undertaking initiatives to enlighten individuals about the importance of conducting their cryptocurrency transactions solely on platforms that are licensed. Unfortunately, cases like JPEX or FTX are the main culprits behind the recent crypto witch hunt regulators from around the World are doing against cryptocurrencies and financial freedom.