The Securities and Futures Commission (SFC) of Hong Kong has issued a public warning about a suspected fraudulent scheme involving a fake virtual asset trading platform that bears the name MEXC. This announcement came directly following a police report on February 9, alerting citizens to the deceptive activities of the counterfeit operation.

Investigation Underway

The SFC’s alert list now includes MEXC and its associated websites, flagging them as potentially dangerous sources of virtual asset trading. In a decisive move to protect investors, the police have taken steps to block access to these websites. A joint working group consisting of the SFC and law enforcement is actively sharing information to monitor and crack down on illicit virtual asset trading.

Modus Operandi

According to the SFC, the scam artists behind MEXC have been enticing unsuspecting victims into joining chat groups on social media or instant messaging platforms, offering what appears to be free investment advice. Once they gain the trust of the victims, these individuals are directed to the fraudulent MEXC websites and encouraged to deposit funds into specific bank accounts for investment opportunities. Unfortunately, these victims later face challenges when attempting to withdraw their funds.

Hong Kong’s Crypto Licensing Framework

Earlier, the SFC had cautioned unlicensed cryptocurrency exchanges operating in Hong Kong to secure the necessary licenses by February 29 or cease operations by May 31. The city-state had previously established a cryptocurrency licensing system for virtual asset trading platforms, allowing for regulated retail trading services. To date, only two platforms, HashKey and OSL, have been granted licenses. The SFC remains vigilant, thoroughly reviewing applications from a total of 14 cryptocurrency companies seeking to operate legally within the jurisdiction.