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Clifford Lo

Hong Kong police have arrested 22 people in a crackdown on a triad-controlled loan shark syndicate that illegally lent money to residents at exorbitant interest rates of up to 2,950 per cent a year.
Chief Inspector Tai Yuk-lun of the New Territories North regional crime unit on Thursday said the racket also charged debtors HK$1,000 (US$128) per minute if they failed to meet the deadline to pay the interest.
“The handling fee and interest rate [the syndicate charged] were extortionate,” he said. “The weekly interest is about 20 per cent of the loan amount.
“For a loan amount of HK$5,000, a debtor was required to pay HK$1,000 in interest a week. The annual interest rate involved is about 2,950 per cent.”
The city’s legal interest rate is 48 per cent a year.
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The syndicate established a call centre in an industrial unit in Tsuen Wan and recruited people to cold-call residents to offer the loans.
Senior Inspector Lee Ka-wing said borrowers did not need to sign any documents, provide proof of income or attend a face-to-face meeting.
“Borrowers only needed to answer two phone calls and send some personal information [copies of their identity cards and proof of address] for the approval of their loan applications,” he said.
Those unable to settle their debts faced threats and members from the syndicate’s operation unit were deployed to splash red paint at their flats, Lee added.
One of the debtors, who lost his job during the Covid-19 pandemic and ran into financial difficulty, borrowed HK$5,000 from the syndicate though he received only HK$3,700 after a hefty handling fee was deducted, according to the force.
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“He had to pay the weekly interest of HK$800 until he could repay the principal of the loan amount,” Tai said. “There was also a harsh term that required him to pay a penalty of HK$1,000 per minute if the interest payment was delayed.”
The chief inspector said debt collectors poured red paint outside his flat and threatened him and his family members when he was unable to pay the interest or penalty.
To avoid detection, the syndicate used ‘stooge bank accounts’ to collect money from debtors and the illegal funds were then used to buy luxury cars, watches, handbags and gold ornaments to launder the crime proceeds, the force said.
Stooge accounts are bank accounts that are sold or loaned for the handling of proceeds involving criminal activity.

A source familiar with the case said an investigation suggested the syndicate had been in operation for about a year with about 100 debtors involved.
After gathering evidence, officers arrested 22 people in a series of raids across the city on Tuesday and Wednesday. They also shut down the Tsuen Wan call centre.
Police said the 19 men and three women, aged 22 to 48, included the alleged ringleader and four core members of the syndicate.
The suspects were detained on suspicion of lending money at excessive interest rates, money laundering, criminal intimidation and criminal damage.
During the operation code-named “Crashevil”, officers seized HK$850,000 in cash and seized luxury watches, handbags and gold ornaments, as well as a Porsche.
Police said the car and valuables, amounting to HK$3.7 million, were suspected to have been purchased with criminal proceeds.
An investigation was still under way and further arrests were possible, police said.


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Crime in Hong Kong

Hong Kong police smash triad-linked loan shark syndicate targeting debtors with interest rates as high as 2,950% a year

Police seized HK$850,000 in cash during raids on the syndicate’s operations. Photo: Handout

Valuables seized during raids on the syndicate’s operations amounted to HK$3.7 million, police said. Photo: Handout

News

Hong Kong

Law and Crime

Force arrest 22 in raids on the syndicate’s activities, including closing a call centre
Ring members were deployed to splash red paint at the homes of alleged victims who couldn’t repay the loans


Force arrest 22 in raids on the syndicate’s activities, including closing a call centre.


Hong Kong police

Crime

Scams and swindles

Hong Kong police smash triad-linked loan shark syndicate targeting debtors with interest rates as high as 2,950% a year

Force arrest 22 in raids on the syndicate’s activities, including closing a call centre Ring members were deployed to splash red paint at the homes of alleged victims who couldn’t repay the loans

Force arrest 22 in raids on the syndicate’s activities, including closing a call centre

Ring members were deployed to splash red paint at the homes of alleged victims who couldn’t repay the loans