Chinese authorities have broken a hacking-tool dissemination ring, according to state media.
Police in the central Hubei province arrested three people suspected of running the Black Hawk Safety Net, state news agency Xinhua reported on Monday.
The Black Hawk Safety Net disseminated hacking tools and Trojans to its members, said Xinhua. The group had collected seven million yuan (£650,000) in membership fees from 12,000 subscribers by the time it was shut down. The group had an additional 170,000 members who had joined for free, said Xinhua.
As well as the arrests, the police also seized nine servers, five computers, a Honda Accord and 1.7 million yuan in assets.
The crackdown comes at a time of strained relations between China and web giant Google, due to hacking and censorship. In January, Google said it may pull out of the country altogether, following hacking attacks that attempted to steal Google intellectual property, and in protest against having to censor its search results. The Chinese government denied involvement in the hacks.
Exactly when the police made the arrests of those accused of managing the Black Hawk Safety Net is uncertain. However, The Wall Street Journal reported on Monday that the arrests were made in November 2009, and that the delay in reporting the case has not been explained.