Police Arrest Lam in JPEX Scandal; Company Raided in Central

Summary

• Lam Zuo, a central figure in promoting the "JPEX" case, has been arrested by the Police Commercial Crime Bureau, with his company in Central raided during the operation.
• The arrest follows a referral from the China Securities Regulatory Commission, which suspected fraudulent activities related to "JPEX".

In a significant development tied to the "JPEX" virtual asset trading platform case, the Police Commercial Crime Bureau has arrested a key suspect “Lam Zuo,” a former lawyer and crypto influencer, according to local media reports. Local sources also stated that his office at the Entertainment Building in Central was raided at around 11 AM local time. 

During the arrest, detectives seized multiple boxes of potential evidence, including a substantial sum of cash. It has been confirmed that Lam Zuo's arrest is directly linked to the ongoing investigation into the "JPEX" virtual asset trading platform case.

The police's involvement in this case was triggered by a referral from the China Securities Regulatory Commission, which suspected fraudulent activities. To aid the investigation, a dedicated hotline was established for the public to report any relevant information.

On September 13, the Hong Kong Securities and Futures Commission issued a public warning over “suspicious” activity from crypto exchange, JPEX. The SFC expressed concern over the aggressive promotion of "JPEX" services and products to the Hong Kong public, facilitated by internet celebrities and over-the-counter exchange shops, highlighting that none of the entities associated with the JPEX Group possesses the necessary licenses to operate a virtual asset trading platform in Hong Kong.

According to a report from the South China Morning Post, the Hong Kong police had received at least 83 complaints involving the crypto exchange JPEX and virtual assets worth about HK$34 million ($4.3 million). 

JPEX stated on Sunday that it is actively negotiating with its partner third-party market makers to resolve the ongoing liquidity issues and adjust withdrawal fees back to normal.