The Hong Kong Securities and Futures Commission has exposed the unlicensed trading platform "BiyaPay", with investors' funds at risk of total loss.

The Hong Kong Securities and Futures Commission (SFC) issued an urgent warning on September 25, reminding the public to be wary of an unlicensed trading platform named "BiyaPay." The platform claims to offer stock trading services for Hong Kong and the United States and has an office in Hong Kong, but it has never been licensed by the SFC, nor has it ever submitted an application. The SFC has placed it on the warning list and emphasized that investors using unlicensed platforms may face the risk of losing all their funds.

The Securities and Futures Commission Reveals Details of the Illegal Operations of 'BiyaPay'

The Hong Kong Securities and Futures Commission has discovered through its social media monitoring system that "BiyaPay" is actively promoting its trading services to investors in Hong Kong. The investigation shows that the public in Hong Kong can easily obtain information about the platform and register accounts through the official website and social media accounts of the platform, and this behavior clearly violates Hong Kong laws.

According to the Hong Kong Securities and Futures Ordinance, any person who operates a securities trading business in Hong Kong without a license or promotes related services to Hong Kong investors is committing an illegal act and may face severe legal sanctions. The Securities and Futures Commission specifically emphasizes that since "BiyaPay" is unregulated, investors will not be able to obtain any statutory protection, and there are significant concerns regarding the safety of funds.

Common Fraud Techniques of Unlicensed Platforms

Although the Securities and Futures Commission has not yet disclosed the specific operating model of "BiyaPay", financial security experts point out that unlicensed trading platforms often use the following fraudulent methods:

Fraudulent trading interface: Provides a seemingly professional trading interface, but actual trades may never be executed.

Funds cannot be withdrawn: setting various obstacles or outright refusing when investors request withdrawals.

Exaggerated profit promises: Promoting unrealistic high return rates to attract investors.

Counterfeit regulatory certification: Forging regulatory documents or claiming to have obtained non-existent permits.

"The danger of these unlicensed platforms is that by the time investors discover the problem, it is often too late," said a financial crime investigation expert who wished to remain anonymous. "Funds may have already been transferred to overseas accounts, and the chances of recovery are extremely low."

Hong Kong strengthens the regulatory environment for digital assets

The "BiyaPay" incident occurred against the backdrop of Hong Kong's active promotion of a regulatory framework for virtual assets. Since the implementation of the new Virtual Asset Service Provider (VASP) system in June 2023, the Hong Kong Securities and Futures Commission has clearly stated that all cryptocurrency trading platforms operating in Hong Kong must obtain the appropriate licenses.

This regulatory trend reflects that while Hong Kong is developing into a global virtual asset center, it is also committed to protecting investor rights and maintaining market order. The Securities and Futures Commission has recently intensified its crackdown on unlicensed operating platforms, and "BiyaPay" is just one of many platforms listed on the warning list.

Key Differences Between Regulated Exchanges and Unlicensed Platforms

For investors, distinguishing between compliant exchanges and unlicensed platforms is crucial. Here are a few key differences:

Regulatory status is open and transparent: compliant exchanges will prominently display their license numbers and regulatory status on their websites.

Client asset segregation: Compliant platforms typically maintain a strict separation between client assets and company assets.

Comprehensive KYC/AML procedures: A compliant platform will implement strict identity verification and anti-money laundering measures.

Clear fee structure: The compliant platform provides a transparent explanation of fees with no hidden charges.

Formal dispute resolution mechanism: Compliant platforms have clear channels for complaints and dispute resolution.

How Investors Can Protect Themselves from Unlicensed Platforms

In the face of the endless emergence of unlicensed trading platforms, investors should take the following precautionary measures:

1. Thorough Background Check

Before using any trading platform, investors should:

· Query the list of licensed persons and registered institutions of the Hong Kong Securities and Futures Commission

· Check the warning list of the Securities and Futures Commission

· Research the company's background, management team information, and operational history of the platform.

· Read independent user reviews and professional evaluations

2. Beware of suspicious signs

The following signs may indicate that there is a problem with the trading platform:

· Promising unrealistic high returns or "zero-risk" investments

· There are spelling errors or improper translations in the website or communication materials.

· Lack of a clear company address or contact information

· Urge quick decision-making or impose unnecessary time pressure

· Only accepts cryptocurrency payments or requests the use of uncommon payment methods

3. Take Security Measures

Even when using a compliant platform, investors should:

· Enable two-factor authentication

· Use strong passwords and change them regularly.

· Do not use the same login credentials across different platforms.

· Regularly check account activity

· Do not store all funds on a single platform

The Hong Kong Securities and Futures Commission calls for heightened vigilance

The Hong Kong Securities and Futures Commission specifically emphasized in its warning: "As the platform is not regulated by the Commission, the protection for investors is very limited, and they may even suffer total loss. Investors are advised to think carefully before investing."

The Securities and Futures Commission also encourages the public to report suspicious unlicensed trading platforms to assist regulatory authorities in taking timely action to prevent more investors from being harmed. If investors discover suspicious platforms, they can report them through the official website or hotline of the Securities and Futures Commission.

With the rapid development of the digital asset market, investor education and self-protection awareness have become more important than ever. Only by trading on compliant platforms can investors obtain appropriate legal protection when issues arise.