- 40 nations contributing to UN Lebanon peacekeeping force condemn 'attacks'
- Eight dead as heavy rain thrashes Brazil after long drought
- Jewish school in Canada hit by gunfire for second time
- Morocco crush Central African Republic, Guirassy scores hat-trick
- Dupont scores quickfire hat-trick on Toulouse Top 14 return
- Ronaldo scores in Portugal's Nations League win as Spain sink Denmark
- Interim boss Carsley has not applied for England job
- Mets hurler Senga ready to take on Dodgers in game one of NL Championship Series
- Ronaldo on target again as Portugal defeat Poland in Nations League
- Guardians rip Tigers 7-3 to advance in MLB playoffs
- AFP, BBC win top French war reporting awards
- Carsley goes back to basics as humbled England face Finland
- Alex Salmond: the man who took Scotland to the brink of independence
- Scotland's former leader Alex Salmond dies aged 69: party
- UN warns of catastrophe as Israel fights a two-front war
- Croatia extend Scotland's losing streak
- South Africa, New Zealand boost T20 World Cup semi-final hopes
- 'Very challenging': Israel faces Hezbollah in tricky terrain
- Farrell begins to feel at home as Racing 92 beat Toulon
- South Africa boost T20 World Cup semi-final hopes with Bangladesh win
- Samson ton powers India to T20 series sweep after record total
- Djokovic to face Sinner in Shanghai final with 100th title in sight
- UN peacekeepers to remain in Lebanon: spokesman
- Pro-Conquest film fuels debate in Mexico over colonial legacy
- Samson ton powers India to record 297-6 in Bangladesh T20
- New Zealand enjoy perfect start to America's Cup defence over Britain
- Pogacar emulates icon Coppi with fourth straight Il Lombardia triumph
- UN warns against 'catastrophic' regional conflict
- New Zealand crush Ineos Britannia in America's Cup opener
- Djokovic to face Sinner in blockbuster Shanghai Masters final
- With medical report Harris seeks to play health card against Trump
- Sri Lanka seeks to match success in W.Indies T20s
- Sinner reaches Shanghai final, will end year number one
- China-EU EV tariff talks in Brussels end with 'major differences': Beijing
- Sabalenka downs Gauff in three sets to reach Wuhan final
- Israel warns south Lebanon residents to 'not return'
- Sinner tames Machac to reach Shanghai Masters final
- Buried Nazi past haunts Athens on liberation anniversary
- Harris to release medical report confirming fitness for presidency: campaign
- Nobel prize a timely reminder, Hiroshima locals say
- Hezbollah fires at Israel as wars rage on Yom Kippur
- Analysts warn more detail needed on new China economic measures
- China tees up fresh spending to boost ailing economy
- China says will issue special bonds to boost ailing economy
- China offers $325 bn in fiscal stimulus for ailing economy
- Dodgers drop Padres 2-0 to advance in MLB playoffs
- Alexei Navalny wrote he knew he would die in prison in new memoir
- Last-minute legal ruling allows betting on US election
- Despite hurricanes, Floridians refuse to leave 'paradise'
- Israel observes Yom Kippur amid firestorm over Lebanon strikes
JPEX crypto fraud casts shadow over Hong Kong nascent policy
Crypto investor Jenny first learned about digital assets at a Hong Kong store that promoted cryptocurrency exchange JPEX in March -- but by September she was among more than 2,000 "inexperienced" victims police said the platform had defrauded.
"Many of my classmates and friends went all in with our investments," Jenny -- not her real name -- who lost "six figures" in Hong Kong dollars, told reporters.
"We never thought it would be a scam."
The scandal surrounding JPEX has so far seen 11 arrests of company staff and affiliated influencers this week for "conspiracy to defraud", with victims' losses exceeding $175 million.
JPEX's downfall is casting a shadow over Hong Kong's embrace of digital assets, with experts saying it has revealed regulatory gaps just three months after the rollout of rules requiring crypto exchanges to get licensed and meet investor protection standards.
The Securities and Futures Commission last week issued a warning against the platform, saying it falsely advertised itself as "licensed" and showed suspicious features like very high returns.
In response, JPEX halted its return-generating products and imposed sky-high fees on withdrawals.
Police on Monday conducted a high-profile raid of 20 premises -- including crypto businesses and private homes -- seizing cash, computers and luxury handbags.
Two telecommunications service providers confirmed Thursday they complied with police to block access to JPEX's website.
Investigators are probing whether JPEX conspired with influencers and shops to play up the platform's legal status and the value of JPEX-issued virtual coins.
"Victims often had a 'fear of missing out' mentality and impulsively believed in advertisements... (But) there is no such thing as a free lunch," said senior superintendent Kung Hing-fun, describing the scale of the case as "shocking".
JPEX -- headquartered in Dubai according to its website -- has blasted the regulatory action as "unfair" and "biased".
It has not responded to multiple AFP requests for comment.
- 'Rogue players' -
Crypto trading is outlawed in China but Hong Kong, which has its own financial regulations, received Beijing's backing to pursue ambitions to become a digital asset hub.
In contrast, regulators in the United States have cracked down on the sector following the implosion of FTX last year, which lost investors billions and sparked a "crypto winter".
Kristi Swartz, a fintech lawyer at DLA Piper, said Hong Kong faced a difficult balancing act as it needed to entice crypto businesses while installing guardrails to protect retail investors.
The licensing system enacted in June targets exchanges but excludes over-the-counter (OTC) brokerages -- brick-and-mortar businesses outwardly resembling money changers -- which Swartz called a "loophole".
As for the enforcement actions against JPEX, Swartz said regulators were "a little bit heavy-handed perhaps, but I think it's the right message to send".
"This is an area where you've got a lot of rogue players."
Some of the OTC businesses are endorsed by popular influencers and host classes where victims like Jenny are subjected to high-pressure sales tactics.
She said the store where she first learned about blockchain felt "like a big family".
A Hong Kong crypto business owner who requested anonymity told AFP that JPEX offered hefty incentives to partner with OTC shops, including better exchange rates and subsidies for advertisement and rent.
- 'Wake-up call' -
Regulators on Tuesday admitted they "do not have a number on how many OTC shops are actually operating in Hong Kong".
Clara Chiu, a former director of licensing at the SFC, told AFP such shops were less popular when she drafted Hong Kong's fintech rules in 2019, and so were not prioritised.
"It is time for us to consider stepping up and expanding our licensing and supervision regime to OTC crypto stores," Chiu said, citing the stores' more "aggressive" marketing lately.
Carlton Lai, head of blockchain and cryptocurrency research at Daiwa Capital Markets, said the scandal "could be a wake-up call" for authorities.
"More regulations are probably needed on OTC shops, from the standpoint of anti-money laundering and know-your-customer" -- but governing influencers will be tough, he said.
Despite the crackdown, JPEX unveiled a "stakeholders dividend plan" on its website Wednesday that let users vote -- and invest -- in the company's future.
"Even in the face of such oppression and unfair treatment, our platform will continue to operate as usual," it said.
O.Johnson--AMWN