Hong Kong police arrested three men in To Kwa Wan, Kowloon, on Monday for allegedly operating a workshop engaged in the production of counterfeit banknotes with face value of around HK$1.4 million (US$178,350).

Acting on tip, police intercepted a 47-year-old American holding a temporary-stay document on Yin On Street that evening and allegedly found 240 HK$500 counterfeit banknotes on him, Oriental Daily reported.

Police say they took him to a unit on the same street and found nine fake HK$500 notes, 30 fake HK$1,000 notes, 35 unfinished HK$500 notes and 1,200 unfinished HK$1,000 notes from three local banks – Bank of China, HSBC and Standard Chartered.

The seized counterfeit banknotes were worth HK$1.4 million altogether.

Police also confiscated three printers, a computer and some other equipment allegedly used in the making of fake banknotes.

They also found some valuables, including 64 mobile phones, four laptops, 11 handbags and 10 watches inside the apartment, believing they were stolen, Headline Daily reported.

Two men aged 35 and 39 returned to the unit while the police were conducting the search. Both were arrested on suspicion of involvement in the production of counterfeit currency and theft.

Police warned citizens to be wary of fake banknotes as some might have already been used by the suspects in convenience stores or taxis.

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