Request 4 Information – Exposing the Wolves of Hong Kong and their fake startup investment scam

Request 4 Information Wolves of Hong Kong
Spread financial intelligence

The impressive Chinese tech scene around Alibaba, Ant Group, Tencent or ByteDance is considered an El Dorado among western tech investors. And Hong Kong is the gateway to this El Dorado for these Western investors. Hong Kong is also a vibrant crime scene of boiler room scams that and lure out thousands of Western investors with shares of worthless fake tech start-ups. A group of more than 30 defrauded European investors that lost millions to those Wolves of Hong Kong has conducted investigations and uncovered the global extent of the fraud.

Victims’ actions so far

The more than 30 European victims of the Wolves of Hong Kong and their fraud scheme have filed complaints with the appropriate Hong Kong supervisory authorities, Hong Kong law enforcement agencies as well as with the compliance departments of the banks involved. The European victims filed criminal complaints against the scammers and the banks involved in their respective home jurisdictions as well as in Hong Kong.

The investors have also entered into a partnership with the European Fund Recovery Initiative (EFRI) to jointly find and recover the money.

Read more on this fraud scheme on EFRI

The Far Far Away Promised Land

China is the “Far Far Land” behind the Big Wall for Western investors because of its geographical distance, its writing, language, and culture. In contrast to the western hemisphere, it is therefore difficult to verify information via the Internet and Google. Not to mention the Chinese Internet censorship. The way to China for the West therefore leads via the European-influenced and English-speaking Hong Kong. Our Wolves of Hong Kong are also based there.

Our Wolves of Hong Kong have therefore chosen Hong Kong to be their place of fraudulent activity. They wait at the entrance gate to China for their victims. Who are they?

The British Wolves of Hong Kong

In fact, the Wolves of Hong Kong are apparently British guys who sell investments in the fake tech startups through their websites and boiler rooms in Malaysia. Research suggests that the following brands and websites have been involved in this scam:

As in every scam, the brands, websites, and entities are changed frequently. The aim is to cover the tracks and lead new investors into the trap. On none of these websites, neither legal entities nor individuals who can be proved to be real are provided. There are also no connected social media accounts.

The scheme is an evolution of the penny stock scams operated by boiler rooms as seen in the movie “The Wolf of Wall Street“. The Internet and its possibilities are used to turn scrap companies into potential superstars and sell their worthless stocks to “far-far-away” investors in Europe at high valuations.

The Fake Tech Startup scheme

In its very essence, the modus operandi of the Fake Tech Startup scheme is as follows:

  1. Boiler Room Fraud: the centerpiece of the scheme are boiler rooms that attack customers via phone, social media, and emails and sell them investments in bogus Chinese tech startups.
  2. Bogus tech startups: Western investors are introduced to bogus (fake) tech start-ups in Hong Kong which are billed as part of the Chinese tech scene. The scammers operate a network of Hong Kong-registered bogus companies
  3. High return promises: Potential investors are promised high profits from future IPOs or trade sales.
  4. Company builders: Scammers work closely with company builders who build and/or acquire and manage Hongkong registered trading and technology companies for them.
  5. Reputation management: a network of online media platforms is operated and/or partnered with to build and maintain a fake reputation of technology companies.
  6. Facilitating banks: bogus trading companies maintain bank accounts with respectable banks to impress potential investors.
  7. Fake investment brokers: the boiler room agents pretend to be experienced investment consultants or brokers and present the investors the perfect Potemkin village.

The background information about the companies and their people is also faked, of course. It looks indeed promising and given the language barriers and the established censorship it’s almost impossible for investors to check the details.

Some Fake Companies

The investment fraud scheme of the Wolves of Hong Kong is huge. Dozens of these fake startups have been founded and offered to investors. In some cases, fake companies have been used that were established more than 15 years ago as dormant companies. So far, the investors’ investigations have revealed at least six of these fake tech startup companies. Some have already been dissolved, thus destroying all evidence. The invested money has naturally disappeared.

Company NameHong Kong CR#Date of registerWebsite
Data Control Technitic114551829th June 2007https://www.datacontroltechnitic.com
3D Printer Technology191032821st May 2013https://www.3dprintertec.com
LECTRIFI Limited249018328th February 2017http://www.lectrifi.com
DigitalPay Limited212150217th July 2014https://www.idigipay.com
Green Farm Asia21057296th of June 2014https://www.greentechfarm.com  
FINTECH (HK) INTERNATIONAL125053025th of June 2008https://www.fhki.net

Facilitating banks

No scam can be performed without facilitating banks and payment processors. In the case of the scam of the Wolves of Hong Kong, the best bank addresses in Hong Kong have facilitated these scams with their services.

The more than 30 victims of the Wolves of Hong Kong – registered with EFRI – transferred more than 8 Mio EUR to 55 Hong Kong-registered fake trading companies which held bank accounts with 7 Hong Kong banks and 6 bank accounts in other jurisdictions.

Leave a Reply

Your email address will not be published. Required fields are marked *