Handcuffs and bitcoins, on a wooden surface

Hong Kong arrests two for suspected involvement in digital asset fraud on AAX

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Hong Kong’s commercial crime investigation bureau on Friday arrested two local men for suspected involvement in digital asset fraud on Atom Asset Exchange (AAX), according to a police press conference.

See related article: Troubled Hong Kong crypto exchange AAX unlikely to reopen, says former executive

Fast facts

  • On Dec. 23, two men aged 37 and 44 were arrested, with the former additionally charged with “misleading police officers” and the latter charged with fraud.
  • “Through false information, news, and illegal means, the trading platform stopped operating, so investors have failed to get back their virtual assets,” said Kung Hing-fun, part of the Commercial Crime Bureau’s Fraud division, during the press conference
  • Authorities further alleged that AAX suspended user withdrawals for “fault and maintenance,” before the exchange’s senior management left Hong Kong with the company’s crypto wallets and private keys.
  • Kung added that other arrests may follow as a result of the ongoing investigation.
  • Hong Kong-headquartered, Seychelles-incorporated AAX is among a growing number of crypto companies caught up in the fallout of the collapse of heavyweight exchange FTX, which has seen investors withdrawing their crypto on fears of industry-wide contagion.

See related article: AAX’s future in doubt amid staff exodus and FTX contagion

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