Customs officials are working with the University of Hong Kong to develop a tool that can trace cryptocurrency transactions, with the authority stressing it had recorded seven suspected money laundering cases involving virtual assets and more than HK$9 billion (US$1.1 billion) in recent years.

Mario Wong Ho-yin, assistant commissioner for intelligence and investigation at the Customs and Excise Department, said on Thursday it would ramp up collaborations with academics, finance and virtual asset industry players, and law enforcement across the region to combat cross-border money laundering.

“These money laundering threats are characterised by a transnational and borderless nature, and no single agency can tackle this problem alone,” he said.

Wong also warned that illegal transactions and trades that used virtual assets, such as cryptocurrency, were on the rise.

He revealed that among the 39 money laundering cases reported to the department between 2021 and May this year, seven involved the use of virtual assets to launder suspected crime proceeds.

Those seven cases involved more than HK$9 billion and mostly involved funds being transferred under the guise of normal trading activity.

Last April, three people were arrested in connection with one of the cases, which involved more than 1,000 suspicious transactions amounting to HK$1.8 billion linked to five companies and 18 local bank accounts.