Over HK$2.6 billion from nearly 830 victims of internet and phone scams have reportedly been transferred in and out of Hong Kong bank accounts during the first half of 2019.
The funds were defrauded in a range of deceptions, including online romance scams, commercial email frauds, investment and phone scams.
Half of the illegal money moving through the city was intercepted by officers of the Anti-Deception Coordination Centre, who launched a range of operations to uncover scams that originated in Hong Kong and across the globe. The remaining HK$1.3 billion was pocketed by international fraudsters.
The local anti-fraud officers stated that nearly HK$140 million was scammed from an investment company in Uruguay. It was this year’s largest single loss intercepted by the anti-fraud squad.
According to police, email scammers impersonating a business partner tricked the South American firm into transferring HK$141 million into two Hong Kong bank accounts in April 2019.
For the first time was since the anti-fraud squad was set up in July 2017, its officers managed to freeze defrauded money in an overseas bank account.
The squad, which is under the Commercial Crime Bureau, pools police resources to handle fraud cases and runs a 24-hour hotline. The special unit collects intelligence, formulates strategies, offers support and organises investigations.
Between January and June, the squad received 829 requests to intercept payments of HK$2.61 billion from victims of scams in Hong Kong and around the world. Officers halted the payments totalling HK$1.29 billion to fraudsters in 304 of the cases.
In the same period last year, there were 680 requests involving HK$2.29 billion. Police helped to freeze more than HK$350 million in 180 of the cases.
Some of the requests were made by overseas companies and law enforcement agencies. Hong Kong police were involved because the money was transferred to bank accounts in the city.
It was noted that large sums of money are usually divvied up into smaller portions to avoid raising suspicions from bank officers. Then, it is transferred into several bank accounts and laundered through layers of accounts before being transferred out of Hong Kong to other countries in Asia, America or Europe.
The anti-fraud unit, which is staffed by police and customs officers, is responsible for assessing all reports made in Hong Kong about suspicious transactions.
Cases it believes deserve further investigation are forwarded to investigators elsewhere in the police force or to the Customs and Excise Department.
Hong Kong police layout guidelines for better cybersecurity
To help Hong Kong’s netizens steer clear of cybersecurity issues and protect themselves from predatory scammers, the Government has created a manifesto.
Netizen is told to remain vigilant and avoid falling prey to these traps. To protect themselves, they should:
- properly configure malware scanning software and keep malware signature files up-to-date;
- secure their wireless networks;
- protect information with strong passwords;
- not use software from unknown sources;
- not download files or software from the Internet indiscriminately;
- not disclose personal data like name, email address and passwords; and,
- apply the latest security patches or hot-fixes from product vendors to their operating system or the applications installed on their computers.
Protecting Hong Kong netizens
In addition, OpenGov Asia reported that the Hong Kong Monetary Authority plans to beef up its cyber risk management protocols and infrastructure to protect the interests of its customers.
In the Hong Kong Monetary Authority (HKMA)’s year-end review presentation (for 2018), it was announced that the financial sector will be stepping up its efforts to combat cybercrimes through the Cyber Resilience Assessment Framework (C-RAF).
C-RAF is a three-part assessment instrument that helps AI evaluate cyber resilience for the banking industry.
The first step in the framework is to assess the level of cybersecurity risk inherent in the bank’s existing systems and put them into buckets such as ‘low,’ ‘medium,’ or ‘high’ risk.
After that, an artificially intelligent (AI) algorithm can be used to determine if the level of the bank’s cybersecurity is mature enough. If it isn’t, the AI can be used to outline a plan to improve its resilience.
Finally, the framework will recommend a test that simulates real-life cyber-attacks.
Managing cybersecurity is not going to be easy for IT professionals. However, the government must work with the financial sector, invest significant resources and pay attention to the trends in cybersecurity to safeguard Hong Kong’s netizens.