China's E-commerce giant Alibaba says two of its top executives are resigning.
The move follows a probe that discovered more than two-thousand suppliers defrauded customers. Some of the allegations include the company's sales staff.
The decision came in an statement Monday.
Jack Ma, Chairman of the Alibaba Group, wrote its chief executive David Wei and Chief Operating Officer Elvis Lee resigned. The move comes despite neither being implicated in the investigation.
The chairman called the fraud of the company as a "breakdown of integrity". He says the firm must send a strong message that it is unacceptable to compromise Alibaba's culture and values. Any tolerance of such behavior is a crime against honest customers.
Alibaba began its investigation after noticing an increasing number of complaints of fraud in late 2009.
More than 23-hundred companies, registered in 2009 and 2010 as "Gold Suppliers" were found engaging in fraud against buyers.
The companies often lured overseas customers into paying for consumer electronics. But after the payment arrived, no goods were delivered.
100 sales representatives from Alibaba.com, allegedly involved in defrauding customers were fired.
Some supervisors and sales managers either intentionally or negligently allowed the creation of fraudulent "storefronts" by letting the phony registered companies evade authentication and verification measures.
Alibaba terminated the "storefronts" of those alleged scammers. It will also collaborate with authorities to seek redress.
The case stunned the E-commerce community in China. Some analysts applaud Jack Ma's decision, saying integrity and courage is the pillar for any business. Some however question the regulation over this emerging market.