Operation ‘Momentum’ uncovers coordinated scam exploiting government-guaranteed financing, with bribery of frontline bank staff
Hong Kong’s anti-corruption agency and police have arrested 32 individuals — including 13 frontline bank employees — as part of a joint operation that uncovered a HK$140 million (US$18 million) fraud involving government-backed small- and medium-enterprise (SME) loans.
The sting, designated Operation “Momentum”, took place on October 30 and 31 and targeted 28 loan applications submitted on behalf of 22 SMEs.
The Independent Commission Against Corruption (ICAC) revealed that bribes totalling HK$500,000 were paid to staff at ten banks to facilitate the scheme.
Investigators say intermediaries orchestrated the entire process, from application preparation to bank submission, with the involvement of both loan applicants and bank insiders.
The loans in question stem from the SME Financing Guarantee Scheme, which offers 80 %, 90 % and 100 % government guarantees for eligible firms—measures originally intended to assist businesses amid the Covid-19 pandemic.
The 100 % guarantee product launched in April 2020 and ran until March 2024.
ICAC principal investigator Grace Yee Hin-Lai cautioned that the misconduct was enabled by weak oversight in the loan-guarantee process and noted that banks and commercial clients alike would face more rigorous checks going forward.
The Hong Kong Monetary Authority and the Hong Kong Mortgage Corporation Limited are working with regulators to review the integrity of the guarantee scheme in light of the arrests.
Banking sources say affected institutions are now conducting internal reviews of staff-referral processes and enhancing training on detecting illicit loan submissions.
Authorities froze some assets and are investigating how funds flowed once disbursed.
The case adds to a series of recent loan-fraud operations in Hong Kong, underlining the challenges facing pandemic-era relief programmes when exploited by well-organised syndicates.
The sting, designated Operation “Momentum”, took place on October 30 and 31 and targeted 28 loan applications submitted on behalf of 22 SMEs.
The Independent Commission Against Corruption (ICAC) revealed that bribes totalling HK$500,000 were paid to staff at ten banks to facilitate the scheme.
Investigators say intermediaries orchestrated the entire process, from application preparation to bank submission, with the involvement of both loan applicants and bank insiders.
The loans in question stem from the SME Financing Guarantee Scheme, which offers 80 %, 90 % and 100 % government guarantees for eligible firms—measures originally intended to assist businesses amid the Covid-19 pandemic.
The 100 % guarantee product launched in April 2020 and ran until March 2024.
ICAC principal investigator Grace Yee Hin-Lai cautioned that the misconduct was enabled by weak oversight in the loan-guarantee process and noted that banks and commercial clients alike would face more rigorous checks going forward.
The Hong Kong Monetary Authority and the Hong Kong Mortgage Corporation Limited are working with regulators to review the integrity of the guarantee scheme in light of the arrests.
Banking sources say affected institutions are now conducting internal reviews of staff-referral processes and enhancing training on detecting illicit loan submissions.
Authorities froze some assets and are investigating how funds flowed once disbursed.
The case adds to a series of recent loan-fraud operations in Hong Kong, underlining the challenges facing pandemic-era relief programmes when exploited by well-organised syndicates.







































