China's Biggest User Data Theft Case Exposes 3 Billion Traces of Online Life in Wrong Hands

China's Biggest User Data Theft Case Exposes 3 Billion Traces of Online Life in Wrong Hands

Liao Shumin

Date: Tue, 08/21/2018 - 19:01 / source:Yicai
China's Biggest User Data Theft Case Exposes 3 Billion Traces of Online Life in Wrong Hands
China's Biggest User Data Theft Case Exposes 3 Billion Traces of Online Life in Wrong Hands

(Yicai Global) Aug. 21 -- China's authorities have busted the biggest online data rip-off in the country's history, as a criminal gang snatched 3 billion items of user records to reap profits worth CNY30 million (USD4.4 million) through marketing businesses. 

The police worked with the security department of Alibaba Group Holding and caught the hackers in the city of Shaoxing in eastern Zhejiang province after they had stolen user data from over 90 internet companies including Baidu, Tencent, Alibaba, and Toutiao, China's official media CCTV reported. 

The group had set up an advertising firm called Ruizhi Huasheng Technology that was listed on China's National Equities Exchange and Quotations and the company had signed marketing contracts with several operators in more than ten provinces nationwide. With the access provided by these deals, Ruizhi Huasheng had inserted a malicious program which collected users' search histories, transaction records, travel logs, as well as hotel check-ins to use this information for advertising purposes on social media platforms, such as Tencent's WeChat and microblogging site Weibo, as well as video streaming site Tik Tok. Some of the loot was stored on Japanese servers, which helped to escape regulation.

In the past two months, users of Tencent's instant messenger QQ had complained about strange additions of friends and groups, as well as spam through sudden pop-ups and text messages. One respondent noticed that eight IP addresses had visited a personal account, and on further investigation, these IP addresses had broken into 5,000 other accounts, while all traces led to the company under investigation. Ruizhi Huasheng was found to operate three companies, all under the control of the same group of criminals, headed by a man surnamed Xing. 

The Beijing-based company moved from software development to online marketing in 2016, after which its profits grew more than 500-fold to CNY10.5 million that year. The firm's legal representative and director Zhou Jialin, as well as supervisors Huang Jian and Liang Xiujun were arrested on July 4. Zhou Jialin got out on bail on July 13.

Editor: Emmi Laine 

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Keywords: User Data Privacy, NEEQ Concept Stock, New Media Marketing, Legal Case, Malicious Program