Law & Crime: International email scams involving Hong Kong hit HK$1.5 billion for the year so far

One foreign business was defrauded of HK$500 million, which an employee was duped into transferring into Hong Kong accounts.

International fraudsters have used Hong Kong to cream off almost HK$1.5 billion in commercial email scams this year, the biggest single transaction being a HK$500 million transfer from an overseas bank, the Post has learnt.

That bank, in Europe, became the biggest loser after an email scammer, pretending to be a senior executive, deceived an employee into transferring the half-billion into several Hong Kong bank accounts.

It is understood that the deceived senior employee was told the fund was for a secret financing project.

The bank and foreign investigators sought the help of Hong Kong police. A police spokesman confirmed the single email scam involving the biggest loss so far this year was suffered by an overseas company and the loss was equivalent to HK$493 million.

Latest figures show the number of commercial email fraud cases dropped to 657 in the first nine months of this year, compared with 738 in the same period last year.

But total losses in that period rose dramatically year on year, from HK$876 million to HK$1.494 billion. The victims were local and overseas companies.

International fraud syndicates are behind the scams, targeting businesspeople and companies worldwide, one source with knowledge of the matter said. “They are sophisticated and operate around the world,” the source said.

The fraudsters typically hack into the email accounts of targeted businesspeople and companies to learn about their clients and businesses, before using the information gleaned to impersonate employees and eventually order the transfer.

They instruct victims, who think they are dealing with a colleague, to send payment or make transfers to their accounts.

The source said some of the emails used to contact and cheat victims were sent from Africa, Russia and India, but that did not mean their operations were in those countries.

“Scammers even visit Hong Kong to recruit people to set up shell companies and open bank accounts to handle crime proceeds,” he said.

Another source said the scams were difficult to detect as scammers were based overseas, and the money hard to retrieve because it is funnelled into different accounts and moved around the world.

Prompted by the rise in cash lost to the ploys, police have warned the public to safeguard personal data and guard against hackers when using electronic devices.

“Hong Kong police will enhance cooperation with overseas law enforcement agencies to fight against such illegal activities,” a police spokeswoman said.

The force urged businesspeople and companies to verify the identities of people they are in contact with, and the genuineness of requests by email, phone or fax, before making cash transfers.

Officers advised people “not to use computers in public places to access personal email, instant messaging or [online banking], or carry out other operations involving sensitive data”.

According to a Legislative Council security panel paper, the number of technology crimes, including commercial email scams, reached 4,537 in the first nine months of this year, involving HK$1.87 billion in losses.

It said the annual number of technology crimes rose from 272 cases in 2002 to 6,862 last year.

According to the paper, the government is seeking the panel’s endorsement to create a permanent post of chief superintendent to head efforts against cybersecurity and technology crime.

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