Hong Kong police recently busted a $15 million money laundering ring that utilized cryptocurrency and more than 500 bank accounts to launder HK$118 million ($15 million), as reported by local news outlets. The syndicate, which was dismantled on May 15, led to the arrest of nine men and three women in mainland China and Hong Kong. The suspects allegedly recruited individuals to open bank accounts to receive proceeds from fraudulent activities, which were then converted into cryptocurrency at exchange shops to launder the illicit funds, according to Hong Kong Commercial Daily. The criminal organization operated from a residential unit in Hong Kong’s Mong Kok neighborhood. The police surveillance on May 15 resulted in the arrest of two recruits who were caught converting cash into cryptocurrency at a shop in Tsim Sha Tsui. Subsequently, ten more individuals, aged between 20 and 41, were arrested. Authorities seized approximately HK$1.05 million ($134,370) in cash, over 560 ATM cards, mobile phones, bank documents, and records related to crypto transactions. Senior Inspector Tse Ka-lun of Hong Kong’s Commercial Crime Bureau revealed that the individuals often used bank accounts of friends and family to launder the stolen funds. This crackdown comes amidst a 12% year-on-year increase in fraud reports in 2024 in Hong Kong, resulting in over 10,000 fraud-related arrests, with 73% of those involving individuals holding stooge bank accounts. The regulatory framework for cryptocurrencies in Hong Kong is evolving to support local innovation, protect consumers, and establish itself as a cryptocurrency hub. The Securities and Futures Commission in Hong Kong recently introduced new regulations for crypto exchanges offering staking services in April, as part of its efforts to improve market access, compliance, product offerings, infrastructure, and industry relationships.