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Chinese authorities have formally charged two corporate investigators with illegally obtaining and selling private information. The case is the first indictment by Chinese prosecutors against foreigners for illegal investigations.

Prosecutors in Shanghai have charged British national Peter Humphrey and his wife Yu Yingzeng, a US citizen, with illegally obtaining private information on Chinese citizens. The two are linked to drug maker GlaxoSmithKline (GSK), which is at the centre of a bribery scandal in China.

According to the prosecution, since 2003 Humphrey, 58, and Yu, 61, have bought and collected personal information on Chinese citizens - such as household registrations, property and car ownership, call logs and exit-entry records – paying 800 yuan ($130) to 2,000 yuan for each item.

Humphrey later founded the Shanghai-based risk advisory firm ChinaWhys in 2004, while Yu worked as its general manager. Their clients were multinational companies, including manufacturers, financial institutions and law firms in 16 countries, including the USA, Germany, the U.K., France and Japan.

Yu Yingzeng made a statement to the police that ChinaWhys have conducted more than 700 "investigations", over 30% of which were involved with personal data trade. Each case charged from 10,000 yuan to more than 100,000 yuan ($16,000). They named each investigation randomly so that employees did not have access to the source of personal data trade. 

In a Shanghai detention house, Humphrey and Yu said in an interview that they have learned that their actions seriously violated the legitimate rights of Chinese citizens and their families as well as some multinational enterprises in China and the personal privacy of their employees.

"To obtain this information, I sometimes used illegal means,” said Humphrey in Chinese mandarin and in English. “I want to apologize to the Chinese government."

Humphrey told journalists that in April 2013 he was contacted by Mark Reilly, then GSK China's general manager and Zhao Hongyan, its legal department director and was prepaid 100,000 yuan (16,143 U.S. dollars).

Reilly then asked him to identify the informant who had disclosed GSK China's bribery scandals to Chinese authorities and GSK's executives.

Humphrey said he learnt a little during a two-month investigation of the informant. Before that, Reilly had told him that the informant was making "groundless accusations".

Humphrey said that after the investigation, he judged the bribery claim was valid based on his work experience of about a dozen years. He felt he had been "betrayed and used" and GSK China's suspicions about the informant were "unfounded".

Humphrey also admitted to having used illegal means to do his investigation, including buying others' information and tailing them.

The couple's rights in custody were well protected and they have seen their attorneys several times. Local courts will hold hearings on the case soon. 

The article is edited and translated from the Chinese version of 《我國(guó)首起外國(guó)人在華注冊(cè)公司非法調(diào)查案提起公訴》, source: People's Daily.