Louis Chen says it is vital to crack down on online‑investment scams and safeguard Hong Kong’s financial order and residents’ wealth

Online investment fraud has become the most damaging type of cyber deception that Hong Kong people face, with official law‑enforcement data confirming a drastic year‑on‑year surge in reported cases and aggregate financial losses. Fueled by sophisticated social‑engineering tactics, influencer‑endorsed traps, and artificial‑intelligence‑enhanced forgery, illegal investment scams have overtaken traditional fraud types and pose the most severe threat to local retail investors’ assets.

According to the 2025 full‑year crime statistics published by the Anti‑Deception Coordination Centre (ADCC) of the Hong Kong Police Force, online‑investment‑scam cases surged 30.7 percent year‑on‑year to 5,135 cases. Total economic losses rocketed 58.4 percent to HK$3.58 billion ($457 million), accounting for 44.1 percent of all scam‑related financial losses across Hong Kong. While investment fraud constitutes only 11.9 percent of total deception cases citywide, it accounts for nearly half of all stolen funds, demonstrating its uniquely high‑risk, high‑damage nature.

Police analysis confirms that the average loss per victim has risen markedly from HK$580,000 in 2024 to HK$700,000 in 2025, revealing that criminal syndicates are targeting larger capital pools and adopting longer‑cycle, high‑disguise deception workflows. Interim figures released by the Hong Kong Police Force Commercial Crime Bureau for the first half of 2026 further validate the grim trend: Hong Kong recorded 20,613 overall fraud cases with total losses of HK$3.5 billion. Among them, 2,151 cases were online‑investment scams, incurring losses of HK$1.66 billion — almost half of the territory’s total scam losses within those six months.

These fraudulent teams build complete fake‑credibility systems. They register shell companies, rent luxury office premises in Central and Kowloon commercial districts, produce polished market‑analysis videos, and continuously post fabricated profit‑withdrawal records and investor success stories. Victims are lured into private chat groups, where pseudo‑analysts provide tailored market forecasts, recommend exclusive trading platforms, and claim stable high returns inaccessible through mainstream regulated financial institutions.

Police have publicized landmark high‑loss cases to alert the public. In a typically tragic pseudo-romance “pig‑butchering” scam recorded in the first half of 2026, a 57‑year‑old overseas entrepreneur suffered losses totaling HK$84.79 million. The victim met a fraudster on Facebook, developed an online‑romance relationship, and was persuaded to pour funds into an unlicensed fake‑trading platform. Consistent with mainstream scam patterns, the platform permitted small‑sum withdrawals in the early stage to establish trust. After the victim increased investment to tens of millions of Hong Kong dollars, the website and mobile application suddenly suspended service, froze account assets and erased all contact channels. Law‑enforcement notes that criminal groups are concurrently deploying AI‑generated virtual‑expert profiles for similar fraud campaigns.

Changing local‑investment habits constitutes another key factor behind the scam outbreak. As Hong Kong residents increasingly participate in online wealth management, virtual‑asset trading, and cross‑border digital investment, public demand for diversified asset allocation continues to grow. However, a large number of retail investors lack systematic financial literacy and regulatory awareness. They easily believe in claims of “low risk, high return, zero‑volatility arbitrage, and insider private‑placement opportunities”, classic slogans prohibited under Hong Kong securities‑regulatory requirements.

In response to rampant online‑investment fraud, Hong Kong’s regulatory and law‑enforcement bodies have launched multidimensional governance and prevention measures. The ADCC has strengthened real‑time big‑data monitoring of suspicious investment websites, mobile applications and social‑media promotion accounts, while rolling out citywide anti‑deception‑education campaigns targeting working adults and cross‑border investors.

The Hong Kong Police Force has launched targeted operations against cross‑border investment‑fraud syndicates, enhanced intelligence synchronization, and joint law‑enforcement with Chinese mainland authorities, and delivered multiple tangible results including freezing fraudulent capital flows, dismantling local operation dens, and arresting core syndicate members.

The Securities and Futures Commission (SFC) reiterates a core regulatory principle: All public‑facing platforms offering securities trading, asset management, and leveraged‑trading services in Hong Kong must hold valid SFC licenses. Any unlicensed platforms promising guaranteed high returns, zero‑loss trading, or internal exclusive channels violate local financial regulations and are highly likely to be fraudulent.

Financial‑industry practitioners stress that the crackdown on online‑investment scams requires long‑term cross‑sector collaboration. Internet platforms must strengthen content review of unlicensed financial promotion; financial institutions need to enhance transaction‑risk‑alert mechanisms for unusual large‑sum cross‑border transfers; and community organizations should continuously upgrade popular financial‑risk education.

As cyber‑fraud technologies keep iterating and cross‑border criminal operations grow more concealed, Hong Kong must sustain technological anti‑fraud upgrades, optimize regulatory‑coordination mechanisms and comprehensively raise public risk awareness. Only through joint efforts by regulators, industries and the public can the city effectively curb the continuous surge of online‑investment scams and safeguard Hong Kong’s stable financial order and residents’ property security.

The author is a member of the Chinese Association of Hong Kong and Macao Studies and a member of the Election Committee of the Hong Kong Special Administrative Region.

The views do not necessarily reflect those of China Daily.