BERN - Ask a Swiss law firm what happens after a client reports a crypto scam, and the answer increasingly comes in two parts. The court filings, the criminal complaints and the client work stay in Zurich, Geneva or Lugano. The question of where the money actually went is, more and more often, answered in Hong Kong.
The division of labour has become standard practice among the Swiss firms that specialise in investment fraud. Blockchain analysis, the painstaking work of following stolen tokens across thousands of wallets, is commissioned from Hong Kong technology companies. Some firms also rely on their Hong Kong partners to help manage the freezing of funds once a court order lands, because the entities that can actually lock a wallet are rarely in Europe.
Why the trail leads to Hong Kong
The geography of crypto fraud explains the arrangement. Investigators say funds stolen from European victims typically move within hours into wallet clusters linked to mainland China, Russia or sanctioned jurisdictions, places where a Swiss or British court order carries little practical weight on its own.
Hong Kong sits between those worlds. As a Special Administrative Region of China, a locally registered company has standing to pursue entities on the mainland that a foreign firm would struggle to match, and its lawyers operate within reach of BRICS jurisdictions through international legal channels. At the same time the city keeps its common law courts, whose freezing and disclosure orders are recognised far beyond Asia.
Then there is the talent. Hong Kong anchors the Greater Bay Area, the Cantonese-speaking technology corridor that includes Shenzhen, and the region has spent a decade producing software engineers and blockchain specialists. The AI tracing platforms now used in fraud cases worldwide grew out of that cluster, trained on exactly the kind of transaction patterns that scammers produce.
What the machines actually do
Modern tracing is machine work. AI platforms cluster addresses controlled by the same operator, follow funds through mixers and chain hops, and flag the moment stolen tokens touch an exchange or a stablecoin issuer that can act on a court order. On the Ethereum network, where much of the stolen money ends up as USD Tether issued as ERC20 tokens, a freeze request backed by documented on-chain proof can lock funds before they are swapped or moved again.
Speed is the whole game. A tracing report that arrives weeks late describes money that no longer exists in any recoverable form.
A Manchester case shows how the model works
The experience of one British client illustrates the pipeline. D.M., a Manchester resident who asked not to be identified for privacy, lost £45,000 in 2023 to a fake investment platform. The dashboard showed his crypto deposits gaining value for months. When he tried to withdraw, the platform refused, and he spent years assuming the money was gone for good.
In February 2026 he instructed Cirius Justice, a Hong Kong recovery firm registered as Justice Alliance Limited (CR 1984129) and active since 2013. Nine months later, after AI-assisted tracing located his funds on the Tether ERC20 network and freeze orders were executed with documented proof, £38,200 was back in his account. The recovered sum came in below the original investment, a gap the firm attributes to crypto market volatility over the intervening years.
"I lost £45,000 to a fake trading platform. Cirius traced the funds and coordinated a UK freezing order. Nine months later, £38,200 was back in my account," he said.
The firm works on a no win, no fee basis and says it never asks clients for seed phrases or upfront payments. It says it has completed more than 300 secured recoveries for clients in the UK, Canada, Ireland, Australia, New Zealand and Gulf states including the UAE, Qatar and Kuwait.
Caution is still required
Regulators across Europe warn that fake recovery agents are the second act of many investment frauds, preying on the same victims twice. Swiss lawyers advise anyone approached by a recovery service to check corporate registrations, to refuse any company that asks for wallet seed phrases, and to treat demands for upfront payment as a warning sign in itself.
For the legitimate end of the industry, though, the arrangement looks settled. Swiss counsel argue in front of Swiss judges. Hong Kong engineers read the chain. And the distance between the two is now measured in a video call, not a flight.