Police on Sunday said they arrested 11 people, including a student, after busting a local fraud syndicate allegedly behind three online shopping scams involving HK$640,000.

Detectives said the scammers, aged 20 to 50, reached out to sellers of luxury spirits and watches.

The fraudsters would then ask to meet at an office under a short-term lease. To gain the sellers' trust, the suspects posing as buyers even meticulously inspected the products and spoke industry jargon.

The transactions were then settled in cash, or "practice banknotes". The tools are used by bank staff to learn how to manually count currency, and usually bear the words "not for circulation".

"The meeting room was carefully set up, and the counterfeit banknotes closely resembled genuine HK$500 notes in size, shape, colour, and texture," said Chau Ho-haung, an inspector with the Wan Chai district crime squad.

The scammers even placed real banknotes at the top and bottom of the stack of fake notes, he added.

When the sellers eventually realised they had been duped, the suspects had already made off with the goods.

Police offered some tips for people conducting face-to-face trades.

The money and the goods should change hands simultaneously, detectives said, and sellers should never hand over items before receiving payment.

In the case of bank transfers, the seller must also verify the payment has been cleared.