Hong Kong has seen three deepfake video scams since 2023, with one of the cases already solved and led to the arrest of nine people, including the syndicate's mastermind, said the city’s security chief on Wednesday.

Secretary for Security Chris Tang Ping-keung told LegCo today that the first case was detected after the police's proactive intelligence-led investigation.

He said the police force smashed a local fraud syndicate in August last year, with the syndicate suspected of stealing identities and using an AI face-swapping program to apply for loans online from finance companies, involving money amounting to HK$200,000.

Nine people, including the mastermind, were arrested for "conspiracy to defraud". This is the first detected case involving AI face-swapping, said Tang.

As for the remaining cases, one of them was reported to police at the end of January this year, which involved the use of deepfake technology to fabricate a pre-recorded video conference.

Tang said the informant received a phishing email from a fraudster, who impersonated the Chief Financial Officer of the informant's head office in the United Kingdom and invited the informant into a group video conference for some alleged confidential transactions.

As instructed, the informant eventually gave authorization to transfer funds to five local bank accounts and suffered a loss of about HK$200 million.

Police’s investigation believe that the pre-recorded video conference was generated using downloaded online public video clips and voices of the impersonated officer. The meeting was pre-recorded and there was no interaction between the informant and the fraudster.

After giving instructions to the informant, the fraudster ended the meeting under some pretext and then continued with the payment transfer instructions using instant messaging software, said Tang.

The last case was reported on May 20 this year, when a staff member of a multinational trade company received a WhatsApp message from a fraudster, who impersonated the Chief Financial Officer of the head office in the UK, and they took part in a video conference for nearly 30 minutes.

Tang said the "fake boss" instructed the staff member to transfer nearly HK$4 million to a local bank account during the meeting.

“According to police investigation, it is believed that the suspect had used online public videos as material for alteration using deepfake technology, and then played the altered content at the video conference to mislead the victim into making money transfers,” said Tang.

Meanwhile, the security chief said a total of 21 online deepfake video clips involving the impersonation of government officials or celebrities were identified by or reported to the police as of May 31.

At the request of the Police, the online or social media platforms concerned had already removed the 21 videos to prevent the public from being defrauded, said Tang, adding that there are no reports involving members of the public being defrauded as a direct result of the deepfake video clips.

Hong Kong sees three deepfake video scams since last year, says security chief