This article is more than 9 months old

This article is more than 9 months old

Hong Kong police have frozen HK$70m ($10m) from a major fund to help pro-democracy protesters, and arrested its four members, accusing them of money laundering.

Police said their investigation focused on Spark Alliance, a non-profit online platform formed in 2016 that collects donations to provide support to political critics of the city’s pro-Beijing authorities.

It is one of two crowd-sourced funding platforms that have collected millions of dollars to provide legal and other help for people arrested in pro-democracy protests that have upended the city since early June.

In a statement on its Facebook page, Spark Alliance described the police allegations as “smears”. The fund said the four arrested had legal representation and that it would not comment further given pending legal proceedings.

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Police alleged on Thursday some of the donations were used by the fund owners for other investments. Senior Superintendent Chan Wai-kei said: “We found the donated money was transferred to a shell company and a significant portion of this money was invested in personal insurance products.

“The beneficiary of these products is the person in charge of the shell company.”

Four people – three men and one woman – aged between 17 and 50 were arrested on suspicion of money laundering.

Chan did not respond directly to questions about whether donating to legal defence funds for arrested protesters could count as money laundering. “Money laundering means you continue to handle the money even when you know it’s gained from unlawful activities,” he said.

He added people could risk committing offences of inciting or facilitating crimes if a person knowingly financed unlawful activities. Last month, Spark Alliance said it would stop receiving donations to its HSBC account, without giving further details.

Hong Kong has been battered by six months of increasingly violent demonstrations in the starkest challenge the city has faced since its handover to China from Britain in 1997. Millions have hit the streets in protests fuelled by years of growing fears that authoritarian China is stamping out Hong Kong’s liberties.

Chinese leader Xi Jinping on Friday said that foreign forces would not be allowed to meddle in China’s domestic affairs. At a ceremony marking the 20th anniversary of the return of Macau, a former Portuguese colony, to Chinese control, Xi said patriotism was key to the success of the city, a gambling hub that also falls under the “one country, two systems” framework.

Xi said: “I must emphasise, since Hong Kong and Macau’s return to the motherland, dealing with these two Special Administrative Regions’ affairs is entirely China’s internal affairs and none of the business of foreign forces. We do not let any external forces interfere.”

Police have arrested more than 6,000 people and charged about 1,000 of them, filling the city’s courts with cases that are likely to last for years. Around 40% of those arrested are students, some of whom face up to 10 years in jail if convicted of rioting charges.