Yahoo! Drops On Alibaba Fraud Arrests

With the news of earlier this month 36 people were detained by police in China linked to Alibaba.com fraud investigations. As a consequence Yahoo! shares dropped almost 6 cents and closed at $12.83.

The fraud spanned several Web sites, not just Alibaba, and involved creation of multiple fake personal and business accounts. The fraudsters were able to take $6.6 million in payments and then never delivered the goods, according to remarks Chao cites by Alibaba Group representatives.

The company said it fired some employees who colluded with sellers creating fraudulent listings.