Hong Kong police arrested five suspects on Thursday, March 5 in connection to the MyCoin alleged Bitcoin scam. Authorities are still searching for the directors and shareholders of the investment company involved in the case.

The arrests follow the sudden bankruptcy of Hong Kong-based Bitcoin trading and investment outfit MyCoin last month, taking with it a possible total of HK$3bn (or US$386.9m at press time), in investors funds.

The company, which claimed it was serving 3,000 clients that had invested as much as HK$1m (US$129,000) each, had been accused by both clients and lawmakers of operating a pyramid scheme.

On Thursday, two brothers, aged 34 and 37, and three women, aged from 48 to 55, were arrested for conspiracy to defraud, reported the South China Morning Post.

According to a source:

"The three women were accused of collecting money from some of the victims to help them invest in Bitcoin trading between January and December last year.

The two male suspects were alleged to have arranged venues to promote the investment."

The five suspects were held for questioning last night, but none had been charged.

The police are still looking for a number of people involved in the case, including "former and current directors and shareholders of the investment company involved," the source stated.

While the police refused to name the said "investment company," victims claimed it is Rich Might Investment. They said they were involved in bitcoin trading through Rich Might Investment since January of last year.

MyCoin logo

In late 2014, MyCoin reportedly began to prohibit full account withdrawals unless further investors were found. More than 50 users claimed they were unable to withdraw funds from their accounts, amounting to a total loss of HH$75m (US$9.6m).

A police spokesperson stated:

"[The claimants] claimed their accounts were not in operation since December last year. They were unable to make withdrawals from their accounts and could not continue trading. They suspected they had been cheated."

According to Companies Registry records, William Dennis Atwood was operating as director of Rich Micht Investment until November 10, 2014, when he eventually resigned after changing the trading rules in order to stop investors from cashing in all their bitcoins. Antwood then transferred all his shares on the same day to a British Virgin Islands-based company called Fascinating Horizon Overseas.

A woman named Wong Lok-yan replaced Atwood as director, but resigned on January 28, according to the records. 

Did you enjoy this article? You may also be interested in reading these ones: