Joseph Lam arrested in connection with crypto asset trading platform JPEX, large stack of banknotes seized (Updated: 1.19pm)

Joseph Lam

18th September 2023 – (Hong Kong) The Hong Kong Securities and Futures Commission (SFC) has recently issued a warning regarding JPEX Group’s misleading statements about obtaining a licence for a crypto asset trading platform in Hong Kong. The SFC clarified that JPEX has never submitted any application for such a licence, either independently or in collaboration with a Hong Kong-listed company. Concerned about these deceptive claims, the SFC has notified social media influencers and over-the-counter cryptocurrency exchange venues. One of the influencers involved in this investigation is lawyer-turn-insurance manager and social media influencer Joseph Lam Chok. Today, it was revealed that Lam has been arrested by police officers from the Commercial Crime Bureau in connection with JPEX.  Officers conducted a search at his Central office. He was subsequently escorted out of the Entertainment Building by two police officers and was then taken into a private police vehicle to the Central Police Station. The officers seized several boxes of evidence, including a large stack of banknotes.

Lam was subsequently escorted out of the Entertainment Building by two police officers and was then taken into a private police vehicle to the Central Police Station.

Lam’s role in this controversy was allegedly to encourage investors to open JPEX accounts and convert their cash into virtual currencies. While he has been claimed to be a partner of JPEX, it is important to note that he does not hold any shares in the company. In response to the SFC’s announcement, Lam had previously stated that the company’s operations remained unaffected.

There have been reports that users of the virtual asset trading platform JPEX are unable to withdraw funds, and some users have claimed that JPEX has set the withdrawal limit to a maximum of 1,000 USDT (Tether) and increased the transaction fee to 999 USDT. JPEX issued a statement last Thursday (14th) stating that they are gradually increasing the withdrawal limit and have established a dedicated team, awaiting a response from the Securities and Futures Commission (SFC). The SFC refuted the claims the next day, stating that since their warning statement about JPEX on September 13th, they have had no contact with JPEX. They emphasised that JPEX’s statements and alleged arrangements or requirements for customer withdrawals were made solely by JPEX. The SFC has referred the case to the police. Upon receiving the referral from the SFC, the case was handed over to the Commercial Crime Bureau for further investigation. According to the information, a person named Lam Chok, who had claimed to have applied to become a partner of JPEX and operated an over-the-counter cryptocurrency exchange in the Entertainment Building in Central, was arrested by the Commercial Crime Bureau this morning (18th). He had previously provided information at the police station to clarify his relationship with JPEX, denying being a partner and stating that he wanted to play an effective role in helping people seek justice.

JPEX has been accused of operating its entities without obtaining a licence from the Securities and Futures Commission (SFC). To date, they have not applied for a licence to operate a virtual asset trading platform in Hong Kong. The law enforcement department stated on the previous day (16th) that they have received a total of 83 reports as of Friday afternoon (15th), involving a sum of approximately HK$34 million.

On 15th September, Lam visited the police station accompanied by his lawyer to provide information voluntarily. His primary intention was to clarify his relationship with JPEX and assist in the recovery of funds on the trading platform in question. Lam emphasised that his motive for coming forward was not to avoid implication but to play an effective role in helping others seek justice. He expressed gratitude for the numerous people who had contacted him, providing valuable information that he wanted to share immediately with the police.

Regarding the alleged partnership, Lam firmly denied the claims, stating that anyone can become a so-called partner of the platform, as the term does not hold a legal or commonly understood definition. He reiterated that he has no collaboration with JPEX and emphasised that his business is entirely unrelated to trading, making it difficult for him to identify the person in charge of the platform.

When questioned about the involvement of other celebrities, Lam responded, “I am not aware of the extent of their participation, but my intention is to genuinely stand up for this cause.”

In a separate statement, Lam expressed his commitment to respecting and adhering to the requirements of the Securities and Futures Commission (SFC). He stated that he would not publicly promote or mention any unlicensed trading platforms in Hong Kong. In a subsequent statement, Lam clarified the situation regarding himself and other celebrities, including Hong Kong actor Julian Cheung, actress Jacqueline Ch’ng, social media influencer Derek Cheung, and Metaphysician Clement Chan Ting Bong. He explained that they had promoted the platform in question in a similar capacity as spokespersons or agents but emphasised that they were not members of the platform. Lam acknowledged that he has faced significant losses in this incident, not only financially but also in terms of his reputation, particularly the reputation of his abilities.

Jacqueline Ch’ng, who was also implicated in the event, has taken down her promotional video. In an interview, she emphasised that she has never had any contact with the company in question. She clarified that it was the company she collaborated with that had a connection to the platform and stated, “I am currently working in Mainland China, and I have limited knowledge of this matter. That’s why I decided to take down the video for now.”