Shanghai police believe they have busted the biggest medical scam in the city with the arrest of more than a hundred members of a crime syndicate that cheated sick people of over a million yuan in overpriced medicines and consultations with fake doctors.

The arrests followed nearly seven months of surveillance beginning in September when the police were first tipped about the syndicate's operations, culminating in a series of raids that led to the arrest of 114 members on April 2.

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Investigations showed that the syndicate hired practitioners of traditional Chinese medicine, placed them in clinics that were grabbed from legitimate doctors, and utilized sales agents to lure sick people into those spurious clinics.

The hired doctors would then prescribe large amounts of overpriced but ineffective medicines to the patients, most of whom have traveled all the way from the provinces to Shanghai to get treatment.

Police identified the syndicate's leaders as one with a surname Yi and another surnamed Chen, who were said to have instructed their gang members to intimidate legitimate doctors into selling their clinics for use in the medical scam.

In their employ were 12 "executives", 90 "salesmen", and 47 "clerks", all of whom have been nabbed and detained.

The syndicate reportedly paid the fake doctors 600 yuan per day to carry out consultations with the sick victims, and then prescribed medicines for them that were priced in the thousands whereas those medicines only cost over a hundred yuan.

Most of the arrested syndicate members were from Hunan province, the police said.

It is not known how long they have been operating the medical scam but investigations showed that they have victimized around 500 people and cheated them of approximately 1.7 million yuan, or US$273,000.

Pudong Police investigators reviewed 70 hours of surveillance video gathered since January, leading to the successful raids on the syndicate members' homes and base of operations, including four clinics in Hongkou, Putuo and Pudong New Area districts.

The spurious clinics have been shut down and around 2,500 boxes of medicines were confiscated. 

Tagscrime, medical scam, syndicate