A tech-savvy entrepreneur in Shanghai has been jailed for 11 years after setting up his own Internet-aided telephone service provider that handled pan-Pacific calls.
Prosecutors said Xiao Puning, 36, used fraudulent means to lease telephone trunk lines from the state-owned Shanghai Telecommunications and then set up a sophisticated system that billed US customers for Internet-routed calls to Vietnam.
Xiao, who masterminded one of the largest Internet-related crimes in China, had a US-based, Chinese-American partner who sent him satellite equipment and other advanced telecommunications devices, according to prosecutor Zhao Yuelin.
Mr Zhao said the imported equipment was valued at 500,000 yuan (HK$470,000). He declined to say how such specialised devices were able to get through Shanghai Customs.
With the American equipment and his partner's help, Xiao 'started operating an IP [Internet Protocol] telephone service that handled calls from the US to Vietnam', Mr Zhao said.
The prosecutor said that during one week in July last year, Xiao managed to steal services worth 2.3 million yuan.