HK Stars in Hot Water Over JPEX Crypto Promos

Hong Kong’s law enforcement agencies are currently delving deep into allegations of fraudulent activities surrounding the cryptocurrency trading platform known as JPEX.

This investigation was launched in response to numerous investor complaints, citing staggering losses totaling HK$1.3 billion (equivalent to $166 million or £134 million).

HK authorities announce arrests linked to alleged fraud at JPEX

Shockingly, this financial ordeal has led to the arrest of eleven individuals, including prominent social media influencers.

The gravity of this situation cannot be overstated, as it potentially ranks among the most significant fraud cases in Hong Kong‘s.

Last week, the Hong Kong Securities and Futures Commission (SFC) dropped a bombshell by disclosing that JPEX, a crypto exchange based in Dubai, had been operating without the requisite license for virtual asset trading.

The platform countered these allegations, asserting its diligent attempts to align with local requirements that only became effective this past June.

However, it claims that its efforts were met with official rhetoric and dismissed by the Commission.

Adding to the complexity of the situation is the fact that many of the aggrieved investors are novices in the world of cryptocurrency trading.

They were lured by the promise of substantial returns, a temptation exacerbated by the platform’s extensive use of influential personalities and large-scale advertising campaigns within Hong Kong’s MTR train system.

One of the arrested figures, Joseph Lam, a former barrister turned insurance salesman, carved a niche for himself as Hong Kong’s “Trolling King” on Instagram.

In July, he assumed the role of an educator, hosting a series of sessions centred on investment strategies.

During these lectures, he made recommendation to his attendees, suggesting that they consider investing through the JPEX platform “before full regulation and licensing” could potentially come into play.

In his latest Instagram post, he notified that there will be an emergency conference at 3pm to update on the latest news with regard to the exchange.

Joseph has taken the initiative to offer clarity regarding the involvement of various celebrities in the promotion of JPEX.

Among these notable figures are Hong Kong actor Julian Cheung, actress Jacqueline Ch’ng, social media influencer Derek Cheung, Taiwanese singer Nine Chen, and metaphysician Clement Chan Ting Bong.

His elucidation sheds light on their roles, clarifying that they functioned in capacities akin to spokespersons or agents for JPEX.

It is of paramount importance to underscore that they were not affiliated as platform members.

Similarly, Chan Yee, a popular YouTube personality with 200,000 subscribers, was also apprehended in connection with this investigation.

The representative of Hong Kong actor Julian Cheung, who has been prominently featured as JPEX’s brand ambassador since August of the previous year, conveyed to local media that no formal agreements were reached to initiate the promotional campaign before JPEX had secured the necessary license.

In a development of note, Julian himself made his way to the police headquarters in Wan Chai just yesterday morning, willingly offering his cooperation in the ongoing investigation.

During his visit, he was reportedly subjected to a video interview and subsequently permitted to depart after the questioning session.

He expressed his gratitude for the outpouring of concern from well-wishers and stated his intent to collaborate with his legal team in determining whether a formal statement regarding the incident would be issued.

In a previous communication, the actor had conveyed through a public relations agency that he had only recently become aware of his images being employed by JPEX.

He clarified that he had been approached earlier for participation in a commercial shoot for JPEX.

During this engagement, JPEX had purported to be registered overseas and had presented pertinent documentation to support its claim.

As events unfolded, it has come to light that Julian had partaken in a promotional shoot for JPEX in March of the preceding year.

By May, he had become apprised of the SFC monitoring the activities of the company.

In response, Julian’s representative promptly dispatched a letter to JPEX, explicitly requesting the platform to cease the use of his images in promotional materials unless and until it obtained the requisite license.

Furthermore, the actor’s legal team explicitly reserved the right to pursue legal remedies or actions in the future, should the need arise.

Another star in hot water is the Malaysian-born Hong Kong model and actress, Jacquelin Ch’ng Se-min.

She found herself at the centre of the JPEX controversy when she produced a promotional video for the platform in mid-July.

However, this video has since been removed from public view.

Notably, she disclosed that she personally incurred losses exceeding HK$100,000 through her involvement with JPEX.

She underscored that her connection was solely with the company she had collaborated with, which happened to be “JPEX.”

Recently, Jacquelin appeared at a dinner event, where she openly acknowledged her substantial six-figure loss in the JPEX incident.

At that time, she declared her lack of intention to report the matter to the police and subsequently returned to her hometown in Malaysia.

While back in her homeland, she has been actively sharing snippets of her daily life on social media and engaging with comments from netizens.

In response to a deluge of comments urging her return to Hong Kong and cooperation with authorities, Jacquelin spoke to Sing Tao Daily, candidly asserting her innocence.

She expressed a desire to see the situation de-escalate, highlighting that the rumors had spiralled out of control.

She emphasised her decision to let her legal representation handle the matter and affirmed her right to consider legal action.

Addressing speculations that her return to Malaysia was an attempt to evade returning to Hong Kong, she clarified that her visit was in celebration of her mother’s birthday.

Regarding the ongoing police investigation, she commented that appropriate actions would be taken based on the involvement and roles of relevant individuals in the case.

She even indicated a readiness to cooperate, stating, “My phone is always on. Reporters can reach me, and the relevant departments can find me if needed.”

In addition, Derek Cheung seems to have engaged in a collaborative venture with JPEX during a noteworthy boxing event held in Taiwan in July.

Known as the “Father of Hong Kong E-sports,” he transitioned into the world of boxing, where he secured a significant victory in a high-profile match against Kurtis Lau Wai-kin, also recognised as Toyz — an individual who had previously worked under Chis wing.

During this event, JPEX extended an exclusive invitation to attendees, offering them the chance to participate in a JPEX voting event with a substantial bonus pool of 15 million JPP.

On that day, Derek was presented with a cash reward amounting to HK$10 million, and this event unfolded in the presence of the Hong Kong media.

In a contrasting manner, Toyz received his reward, roughly estimated at HK$3.5 million, in the form of cryptocurrency via the JPEX platform.

Notably, the event organisers took ample time to introduce the company to the audience, using the cash payment to Cheung as a testament to the financial robustness of their organisation.

However, Derek has clarified his role in the event, affirming that he had no hand in its organisation and had solely participated as an invited contestant.

Interestingly, his photograph appeared prominently in the JPEX partners’ section on the platform’s website, setting him apart from other partners.

It is presumed that JPEX featured his photo as part of their sponsorship arrangement.

JPEX’s presence has also extended to Taiwan, where it once employed the famous Taiwanese celebrity Nine Chen as an influencer and even sponsored a boxing match on the island.

In light of the regulatory scrutiny faced in Hong Kong, Nine expressed that:

“After learning about the JPEX incident, I wanted to understand the situation, but currently I can’t contact the relevant people at JPEX. The company is handling other details. If relevant units need to investigate, I will fully cooperate.”

In the aftermath of these arrests, trading operations on JPEX within Hong Kong have been halted, and authorities have taken steps to restrict web access to the platform.

Furthermore, JPEX has publicly acknowledged a “liquidity shortage” that has left some users unable to withdraw their funds.

Hong Kong’s Chief Executive, John Lee, has committed to vigilant monitoring of the situation and ensuring adequate protection for investors.

He emphasised the importance of selecting licensed platforms for virtual asset investments, signalling his government’s intention to bolster investor education to enhance public understanding of risks and regulatory mechanisms.

The license requirement imposed on platforms like JPEX is a crucial step toward accountability and compensation when necessary, as emphasised by Francis Fong, the honorary president of the Hong Kong Information Technology Federation.

However, some experts in the digital economy field caution that existing legislation may fall short in preventing illicit operations by virtual asset platforms and safeguarding investors against losses.

In a sign of collective distress, affected investors have formed Facebook groups, such as “JPEX Sufferers,” to share their experiences and seek recourse.

* Original content written by Coinlive. Coinbold is licensed to distribute this content by Coinlive.

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