Police raided offices in Kowloon on Monday and arrested 49 men and five women over a suspected gold trading scam.
After two years of work by an undercover agent, police raided two gold trading companies in Tsim Sha Tsui and Kwun Tong. There, they arrested the directors, shareholders, agents and people in charge of the two firms for alleged conspiracy to defraud and money laundering, Apple Daily reported.
Some of the male brokers posed as attractive women on social media platforms such as WeChat to sweet-talk male customers into investing in gold on the London market. Victims of the scam were persuaded to invest by claims of big rewards.
Superintendent Chung Lai-yee of the Organized Crime and Triad Bureau said victims came from Hong Kong, mainland China, Singapore, Malaysia and Taiwan.
After befriending the investors on social media, the brokers would lure them into signing documents that gave the fraudsters the power to handle transactions for them on the gold market.
Victims were later notified that their principal investments had been lost in trading. The firms would then relocate and break contact.
Police seized HK$1.37 million (US$174,613) in cash, computers and mobile phones. They froze 18 bank accounts, impounded two Porsches and a Mercedes-Benz, and a residential flat worth HK$5 million went into lockdown, Headline Daily reported.
It is believed that more than 20 victims were defrauded. Some investment plans promoted by the scheme cost HK$1 million, while the wealthiest client handed over more than HK$10 million.