Hong Kong legislators respond to the US$500 million fraud case involving a trust institution: the outside world may have misunderstandings about the Hong Kong system

Odaily News In response to a trust institution being involved in a US$500 million fraud case and raising doubts about Hong Kong's system, Wu Jiezhuang, chairman of the Hong Kong Legislative Council's Web3 and Virtual Asset Development Subcommittee, said that Hong Kong is actively attracting foreign capital, including from the mainland, but many outsiders have limited understanding of Hong Kong's system and even have misunderstandings. This is a problem that needs to be faced.
Wu Jiezhuang pointed out that the incident is expected to attract international attention and the relevant regulatory mechanisms must be reviewed as soon as possible to respond to social concerns. At present, Hong Kong has not yet established a special asset custody regulatory system. Some Web3 companies will use trust companies as a means of third-party custody of assets. If they follow the formal procedures, there will be no problem. However, if the loopholes in the system are exploited by criminals, it may affect the outside world's confidence in Hong Kong's financial center.
He suggested that more publicity and education efforts should be made, and the system should be examined to see whether there is room for improvement to prevent similar incidents from happening again.