Chinese man arrested after making $1.6 million from selling VPN services

Chinese authorities continue their crackdown against unauthorized VPN services with what appears to be their biggest catch so far.

VPN

Image: Danny144 on Pixabay, ZDNet

Chinese authorities are continuing their crackdown against sellers of unauthorized and unregistered VPN software inside the country's borders, especially against VPN services that are advertised as capable of bypassing the country's Great Firewall technology.

Arrests have been going since mid-2017, but Chinese authorities appear to have landed their biggest catch at the end of 2019.

According to a report from Litchi News, Chinese police from the city of Taizhou have arrested a 29-year-old man that they claim has made a fortune by selling VPN services.

The suspect, identified only by the pseudonym of Gao, operated a VPN service to bypass the country's Great Firewall since mid-2016.

The service was extremely successful, according to the report, which claims that Gao made more than $1.6 million (11 million Chinese yuan) from renting access to VPN servers to more than 28,000 regular customers.

The estimated revenue is more than any other VPN provider arrested by Chinese authorities by this point -- most of which had earned meager sums in the range of tens of thousands of US dollars, based on past reports.

Gao pleaded guilty last year and is currently awaiting sentencing, which is expected to be a lenghty one.

For comparrison, in September 2017, Chinese authorities sentenced a Dongguan man to nine months in prison for operating a VPN service through which it was estimated that he made a meager $2,000. Similarly, in December 2017, Chinese authorities sentenced a Pingnan man to a whopping five years in prison for operating an unregistered VPN service and making around $120,000 by renting access to 8,000 customers.

Gao's sentence is most likely to be on par, if not greater, to the one received in this latter case.

Running a VPN service in China is not illegal; however, as of 2017, all VPN providers must register with Chinese authorities and make sure their service is not used for any criminal activity or to bypass the country's national firewall.

Back in January 2017, Chinese authorities announced they would launch a 14-months-long coordinated campaign to take down all unauthorized VPN providers that had not registered with local authorities.

As part of this effort, Chinese officials asked Apple to remove tens of VPN apps from the company's Chinese version of the App Store. Apple complied.

According to a 2016 report, China has long viewed and categorized VPN services, proxies, and other traffic anonymization tools as "terrorist software."