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Police said on Tuesday the mastermind behind the operation of the unlicensed cryptocurrency exchange JPEX was still to be determined, which saw one of the potential victims losing HK$40 million in virtual assets.
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Officers were still hunting for the man in charge of JPEX, as the investigation into the alleged fraud case is ongoing after police received more than 1,640 reports against the platform and investors claiming to have lost around HK$1.2 billion in total.
The investors, aged 18 to 49, complained of being unable to withdraw their virtual assets from JPEX accounts, while some found their asset balances were reduced and altered. One said he had around HK$40 million investment on the platform that could not be withdrawn.
Regarding the local reports that some individuals deemed to be related to JPEX have left the city after the case was unfolded, the Commercial Crime Bureau of the police force said those will "definitely be extradited to Hong Kong" if they violated Hong Kong laws.
Read more: Eight arrests linked to JPEX scandal involving HK$1.2 billion of virtual assets
The Securities and Futures Commission (SFC) said in the press conference that the commercial practices of JPEX are "suspicious" and "misleading" as it has been actively promoting its products and services to the public through social media influencers as well as over-the-counter (OTC) virtual asset money changers.
That included JPEX stating on its website that it is "a licensed and recognized platform to facilitate the trading of digital asset and virtual currency," which is not the truth, and influencers or OTC shops have made false or misleading statements on social media to suggest that JPEX has applied for a virtual asset trading license in Hong Kong though, in fact, no entity in the JPEX group has submitted any license application to the SFC.
When asked about the number of OTC shops that operated in the city and how many trading platforms have applied for a license, SFC said it was unable to provide any data on the OTC shops or applications in progress, while it stressed that there are only two licensed virtual asset trading platforms in Hong Kong.
