Hong Kong Customs detects money laundering case involving about $11.3 million following illicit cigarette investigation
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In January this year, Customs raided a suspected illicit cigarette storage facility in Ngau Tam Mei, Yuen Long, and seized around 2.2 million suspected illicit cigarettes. A 37-year-old man connected with the case was arrested. A subsequent financial investigation revealed that the arrested man has been using his own and a 35-year-old woman's personal bank accounts to receive payments for illicit cigarettes since 2025. Upon further investigation, another man, aged 31, was identified and suspected to be supplying illicit cigarettes to the 37-year-old man for distribution. Fund-flow analysis further revealed that there were numerous suspicious transactions in the personal bank accounts of the two men between January 2021 and February this year. They were suspected to be using their local personal accounts to deal with suspicious funds, including proceeds from selling illicit cigarettes, and participating in money laundering activities.
Following in-depth investigations, Customs officers yesterday raided five residential premises and arrested two local men and one local woman for "dealing with property known or reasonably believed to represent proceeds of an indictable offence" (commonly known as money laundering) under the Organized and Serious Crimes Ordinance (OSCO). During the operation, a batch of items suspected to be connected with the case was seized, including mobile phones and bank cards.
An investigation is ongoing. The three arrested persons have been released on bail pending further investigation. The likelihood of further arrests is not ruled out.
Relevant offences relating to duty-not-paid tobacco have been listed under the OSCO, enabling Customs to freeze assets associated with related criminal activities. Customs will consult with the Department of Justice to apply to the Court for enhanced sentencing under the OSCO, with a view to heightening deterrence.
Customs stresses that it is an offence to buy or sell illicit cigarettes. Under the Dutiable Commodities Ordinance, any person who deals with, possesses, sells or buys illicit cigarettes commits an offence. The maximum penalty upon conviction is a fine of $2 million and imprisonment for seven years.
Under the OSCO, a person commits an offence if he or she deals with any property knowing or having reasonable grounds to believe that such property in whole or in part directly or indirectly represents any person's proceeds of an indictable offence. The maximum penalty upon conviction is a fine of $5 million and imprisonment for 14 years, while the crime proceeds are also subject to confiscation.
Members of the public may report any suspected money laundering activities to Customs' 24-hour hotline 182 8080 or its dedicated crime-reporting email account (crimereport@customs.gov.hk) or online form (eform.cefs.gov.hk/form/ced002).
Ends/Wednesday, May 13, 2026
Issued at HKT 12:40
Issued at HKT 12:40
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