Security Experts:

Sri Lanka Arrests 114 Chinese for Online Currency Fraud

COLOMBO - Police in Sri Lanka arrested at least 114 Chinese nationals over an alleged Internet currency fraud, during a string of raids in and around Colombo, officials said on Saturday.

The arrests were made after Chinese police sought assistance from their Sri Lankan counterparts in cracking the alleged fraud ring.

"They were charged under the Cyber Crime Act," a lawyer who assisted the inquiry but did not wish to be named told AFP.

The accused were arrested following a joint investigation by Sri Lankan and Chinese police, senior superintendent Prishantha Jayakodi told AFP. "They have defrauded their countrymen by making them... transfer money to accounts maintained in Sri Lanka in the names of those arrested," Jayakodi said.

The Chinese police requested help after identifying several call centres in the tropical island nation involved in the alleged fraud, Sri Lankan police said. "The fraud-affected people (live) in China," Jayakodi said.

"The fraud was carried out in Sri Lanka through the Internet." Police said the Chinese nationals arrested were in the country on tourist visas.

Thousands of Chinese work in China-funded development projects across the island. Many more arrive on tourist visas and work in the hospitality industry. The arrests come as China invests heavily in Sri Lanka, as it strengthens its presence in South Asia.

In June, Sri Lanka opened its first Chinese-built port, for which Beijing loaned money. The port is regarded as a strong symbol of Beijing's investment and interest in the region.

China is also building a second port in Colombo and Chinese firms have pledged investments totalling $50 billion spread over the next 10 to 15 years, according to Sri Lanka's trade ministry.

Regional power India views Sri Lanka as being firmly within its sphere of influence and has been concerned about China getting a foothold there and in other surrounding countries.