The syndicate set up its operations centre in a 4,000 sq ft industrial unit. - Photo: Shutterstock via SCMP
HONG KONG: Hong Kong police have for the first time smashed a local fraud syndicate that used deepfake technology to swap the faces of the swindlers with those of attractive women in video calls to cheat love-struck men in the region, including Singapore, out of HK$360 million (U$46 million - RM200 million).
The force said on Monday it had arrested 27 people, including university graduates recruited by the syndicate to set up fake trading platforms that were used to lure victims into “investing” in cryptocurrencies.
The victims included men from Hong Kong, mainland China, Taiwan, India and Singapore, among others, the force said.
Sources said it was the first time local authorities had cracked down on a Hong Kong-based fraud syndicate that employed deepfake artificial intelligence (AI) technology to cheat people.
Police said the syndicate set up its operations centre in a 4,000 sq ft industrial unit in Hung Hom in October last year and began to recruit workers.
Senior Superintendent Fang Chi-kin, who heads the New Territories South regional crime unit, said the recruits included university digital media graduates, who helped the syndicate set up the fake trading platform and carry out their crimes through computer networks and social media platforms.
The syndicate group, run by members with triad backgrounds, operated a fraudulent center in a 4,000-square-foot industrial unit in Hung Hom and offered training to its scammers.
Police on October 9 seized over 100 mobile phones, more than HK$200,000 in cash, a large amount of computer equipment and luxury watches suspected to belong to core members of the group.
The scammers, mostly male, contacted victims via social media, using artificially generated images to create appealing personas, often pretending to be women through deepfake technology.
Once trust was established, they presented cryptocurrency investment opportunities, convincing victims to invest large sums, showing forged trading records. Many victims realized they had been scammed only when they could not withdraw their funds.
The group recruited individuals under false pretenses of clerical jobs, with some recruits choosing to stay for financial gain. Most members, aged 21 to 34, were well-educated.
The police also seized training documents that advised scammers on how to appeal to victims, including maintaining a "billboard" to highlight top earners.
Authorities believe the syndicate had been operating for about a year and condemned their actions as disruptive to victims' lives. The investigation is ongoing as police seek more information about the group's operations.
The suspects also have been arrested on suspicion of conspiracy to defraud and possessing offensive weapon.
Fang said the syndicate made use of deepfake technology to build relationships online.
"They got in touch with the victims on social media, and sent them photos generated by AI, shaping a character who had a very appealing appearance, personality, career and academic qualifications," he said.
"Men from different regions were among the victims... Although the victims had video calls [with the character], they falsely believed that they were dating a high-quality person."
Fang added that the syndicate hired people with high academic qualifications.
"The syndicate hired graduates from local universities who majored in digital media, and used them as technology specialists. From our investigation, they also collaborated with overseas fraudsters and IT experts to build a fake cryptocurrency investment platform."
Superintendent Iu Wing-kan said the syndicate had been operating for more than a year.
"They set up a performance board. The teams and members who successfully fooled the most victims were listed on the board. The one who topped the chart last month gained US$266,000," he said.
