(Yicai Global) Dec. 8 -- A unit of smartphone maker Gionee Communication Equipment was recently convicted of colluding with other companies to implant Trojan horse malware in 26.52 million Gionee phones to help other apps swell their active user numbers, thereby yielding nearly CNY30 million (USD4.6 million) in profits.

Beijing Baice Technology and Gionee’s Shenzhen Zhipu Technology unit agreed to engage in the 'pull actions' in July and August 2018 to show ads and download apps without users’ consent, according to a court ruling by a court in Yiwu in China's southeastern Zhejiang province, a city home to the world’s largest small commodities market.

The two parties agreed to implant the ‘Living Trojan Horse’ Baice developed into users’ Gionee phones' ‘Story Lock Screen’ app, which automatically updated without the user's knowledge and was executed 2.88 billion times to generate CNY8.42 million in profit for Zhipu Technology.

The company was fined CNY400,000 (USD61,257.6) for the crime of illegally controlling a computer information system, per the judgment, which also ordered more than CNY8.4 million of its illegal gains forfeited. Defendants were sentenced from three to three and a half years imprisonment for illegally controlling computer information systems and received a CNY20,000 fine.

Gionee, which has been bankrupt for two years, holds 85 percent of the shares of Zhipu Technology. As Gionee's only operating subsidiary, Zhipu Technology is still repaying Gionee's suppliers.

The ruling issued on Nov. 30 and subsequently published on the China Judgment Document Network, also noted that, in addition to the cooperation with Zhipu Technology, Beijing Baice had also connived with another mobile phone maker, Meizu Technology, to ply their ‘pulling’ tricks. Meizu responded to the report about it “secretly implanting Trojan horses in mobile phones” on Dec. 5 by denying its involvement in the illegal acts.

Gionee, founded in 2002, had 130 million users in 2013, but retreated into bankruptcy reorganization on Dec. 19, 2018.

Editor: Ben Armour, Xiao Yi