The Hong Kong Police have reportedly arrested six people associated with the JPEX crypto exchange after receiving a significant amount of fraud complaints.
Yesterday, JPEX suspended transactions on its Hong Kong platform, attributing the action to what it perceives as “unfair treatment by relevant institutions,” placing responsibility on its third-party market makers.
JPEX Crypto Exchange Faces Staggering Amount of Fraud Complaints
A recent local report reveals that the Hong Kong Police have taken action, arresting four men and two women suspected of having connections to the troubled exchange JPEX.
Two of the arrestees are known YouTube influencers, Joseph Lam Chok and Chan Wing-yee. Both allegedly promoted the exchange to their substantial online audiences.
According to the report, authorities have been inundated with 1,408 complaints alleging fraudulent activities related to JPEX. The amount reportedly involved totals approximately HK$1 billion, roughly equivalent to USD $128 million.
The Hong Kong Securities and Futures Commission (SFC) recently issued a warning regarding JPEX’s licensing status. The primary basis for the warning is JPEX’s operation without a valid license. It further alleged that it lacks intent of applying for one.
On the same day as the arrests, JPEX announced that it had been actively preparing to comply with Hong Kong’s cryptocurrency regulatory requirements before “the end of the grace period for the licensing system.” However, it claims unfair treatment in comparison to other exchanges in the region:
“However, the SFC did not fulfill its promises. When other cryptocurrency exchanges announced their entry into the Hong Kong market and began extensive promotion, JPEX was subjected to continuous unfair treatment.”
JPEX Services Halt Abruptly
This came just one day after JPEX provided its users with an explanation for the sudden interruption of its services.
On September 17, JPEX released a statement informing its users that it halted all transactions on its Earn transaction service. JPEX noted this change would become effective within 24 hours.
It attributed the suspension of the service to a liquidity shortage caused by third-party market makers. It further explained that to stay stable, it must make changes to the structure.
JPEX will withhold any details until they have finalized all the necessary information.
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