(Bloomberg) — Hong Kong’s police force said it arrested 15 people in connection to last month’s surge in shares of Next Digital Ltd., the media company owned by vocal government critic Jimmy Lai.The arrests were made on suspicion of the use of illegal funds and conspiracy to defraud, Chung Wing-man, chief superintendent of the narcotics bureau, told reporters at a Thursday briefing. The people, who made a combined profit of about HK$38 million ($4.9 million), traded a high volume of Next Digital shares and the police have reason to doubt their source of income, Chung said.Police said one of the people had links to organized crime, and six were unemployed.The news marked the latest twist in a drama that has captivated the financial hub since Lai was held last month under Hong Kong’s controversial National Security Law. Next Digital soared more than 1,000% in a span of two days in August amid online calls to buy the stock in a show of support for Lai. Shares have since wiped out most of those gains after Hong Kong’s securities regulator urged “extreme caution” and after Lai himself told his supporters to avoid buying.After initially falling on Thursday, shares of Next Digital soared as much as 97%, mirroring last month’s sudden gains. A spokesman for Hong Kong’s Securities and Futures Commission declined to comment on the arrests, while the police declined to comment on whether the markets watchdog was involved in the investigation.“It’s unusual for the police to be involved in a market manipulation case — it may be over-eagerness on their part to show action that relates to Apple Daily,” said David Webb, a Hong Kong-based activist investor. “Normally the SFC takes it to the criminal Magistrates’ Court or the civil Market Misconduct Tribunal, without any great spectacle. ”Webb said he was once a substantial shareholder in Next Digital’s shares but declined to comment on his current holdings of the stock. He owns 7% of Hong Kong Economic Times Holdings Ltd., he added.The rally in August followed a campaign by pro-democracy supporters to buy up the company’s shares as a way to push back against his arrest. Some Hongkongers and businesses that support the democracy cause have also been buying up advertisements in Lai’s Apple Daily to show their support.“People with very little money just want to express their anger and express their support for our company,” Lai said in an interview with Bloomberg Television last month. “Everybody bought a little bit. That became a lot of it and jacked up the price. I was telling people ‘don’t do it, don’t do it, because you’re going to lose money.”Hong Kong’s SFC has requested brokers to submit client information and recent transaction records related to Next Digital’s shares, the Hong Kong Economic Journal reported at the time, citing unidentified brokers.More than 516 million Next Digital shares changed hands on Thursday, compared with a record 4.1 billion on Aug. 11.“It’s quite bizarre that local police rather than the markets regulator is investigating a stock market incident,” said Alvin Cheung, associate director with Prudential Brokerage Ltd. in Hong Kong. “People might wonder if there’s something else going on.”(Updates with activist investor quote in sixth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.