A spokeswoman for Hong Kong Broadband confirmed yesterday that they had sought help from the police in February after finding suspicious sales records during an internal audit late last year.

'We believe some salespeople were using dishonest tactics to cheat the company out of commission,' she said. 'Our internal investigation revealed no more than five [of our] former salespeople were involved. They had left the company before we discovered the suspicious sales contracts.' No serving staff were involved and no clients had suffered any financial losses.

After a two-month investigation, officers from Kwai Tsing district crime squad struck at 6am with the help of four technicians from the broadband company.

Officers made the arrests as they raided a number of flats in Choi Hung, Tsuen Wan and Tuen Mun.

Eleven decoders and a computer were seized. One man was confirmed to be a former employee of the broadband company, according to a police investigator.

Two men were taken to Kwai Chung police station for further investigation.

A spokeswoman for Hong Kong Broadband said more than 20 suspicious sales records were signed in 2004 and last year. 'One of their methods involved using addresses of their neighbours but paired with fake personal data [names and ID card numbers] to make bogus applications for internet services.'

She refused to reveal how much money was involved, saying only that a salesman could earn hundreds of dollars in commission for every new application.

Officers also spoke to residents at Ping Shek Estate yesterday and checked the wiring outside several flats.

One elderly woman on the estate said police had asked her whether she had applied for internet services with Hong Kong Broadband Network.

Last night, the suspects were being held for questioning, but no charges had been laid. Police said they might make more arrests.