Hong Kong Customs Pursues Another Unregistered Dealer Over Cash Watch Sale Above HK$120,000

Hong Kong Customs Pursues Another Unregistered Dealer Over Cash Watch Sale Above HK$120,000

A second case in two weeks, same pattern

Hong Kong Customs said on October 23 that it had detected a case the previous day involving a local company that conducted a cash transaction of watches containing precious metals and stones valued at more than HK$120,000, without holding Category B registration under the Dealers in Precious Metals and Stones Regulatory Regime. The investigation is ongoing. As reported by HK01 and On.cc, citing the Customs announcement, it is the second near-identical case made public within half a month, following one detected on October 8.

Cash deals require Category B registration

Under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615), anyone intending to deal in precious metals and stones in Hong Kong and conduct transactions of HK$120,000 or more, whether receiving or paying, must register with Customs. Only a Category B registrant may conduct cash transactions at or above that threshold in the course of the business. A dealer without Category B status that claims to hold it, claims to be authorised, or actually carries out such a cash transaction commits an offence. Customs reminded dealers that they must secure the relevant registration before conducting any cash or non-cash transaction of HK$120,000 or more.

Why the rule keeps biting watch sellers

The HK$120,000 threshold is easily crossed by a single high-end timepiece set with diamonds or precious metal. The regime has two tiers: Category A covers dealers handling large non-cash transactions only, while Category B additionally permits cash deals and brings the dealer under anti-money-laundering supervision. Retailers accustomed to settling luxury watch sales in cash, and unfamiliar with the cash versus non-cash distinction, are the most likely to trip over the line. In late September Customs issued a separate reminder to non-local jewellery exhibitors that they are bound by the same regime.

Retailers and cash buyers feel it first

The immediate impact falls on local watch, jewellery and bullion retailers and wholesalers: taking a large cash order without Category B registration is itself an offence. For buyers, paying cash for a watch or jewel worth well over HK$100,000 at a compliant shop will now mean identity checks and record-keeping rather than a simple handover. The penalty is not trivial: on conviction, a fine of up to HK$100,000 and six months' imprisonment.

Investigation continues, reporting channels open

Customs has released no name of the company and no deal details, saying the investigation continues. It published reporting channels for suspected unregistered transactions of HK$120,000 or more: the 24-hour hotline 182 8080, a dedicated crime-report email address and an online form. Application forms and guidance are available on the Dealers in Precious Metals and Stones Registration System website. For the trade, the signal is clear: expect closer scrutiny of cash deals, and check registration status before accepting the next big order.