A man in China has been sentenced to one year and three months in prison for pocketing a staggering 3 million yuan ($415,000) in less than four months after orchestrating a sophisticated scheme involving 4,600 mobile phones to artificially boost live-stream viewer counts, as reported by the South China Morning Post.
This marks the first instance of prosecution for such fraud in Zhejiang province, the epicenter of China's booming live-streaming industry.
It has also spurred authorities to increase their vigilance over the live-streaming environment. Currently, 17 more individuals are under investigation for their involvement in a range of offenses, including the dissemination of online misinformation and disruption of market dynamics.
The Chinese Scammer
The individual, identified as Wang, started his fraudulent activity in late 2022 after being informed about the profitable strategy known as "brushing" by an acquaintance. According to the Wall Street Journal, brushing is a deceptive practice wherein fake real-time interactions, such as viewer counts and engagements, are artificially generated to make it seem like there is authentic viewer interest.
This manipulation is intended to deceive consumers into believing that a particular product, service, or content is more popular or engaging than it is.
Wang's modus operandi involves 4,600 mobile phones that were equipped with specialized cloud software, along with investing in VPN services and network equipment from a technology company in Changsha, Hunan province.
Using his computer, Wang could easily activate this extensive network of devices with just a few clicks, allowing him to flood targeted livestreams and artificially boost viewer counts and interactions.
Operating each phone costs Wang just 6.65 yuan per day, which is less than US$1. The total fee for his services depended on how long each phone remained connected to live-stream events and the number of phones he activated. Despite the low operating cost, Wang's scheme proved immensely profitable.
The Chinese scammer also purchased bulk fake viewer accounts and exploited weaknesses in live-streaming platforms' account management systems. When confronted with censorship resulting from failed authentication, he resorted to straightforward re-registration processes to avoid detection.
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