Japanese authorities have arrested a Chinese exchange student for hacking into the online game Lineage II.

The hacker had crafted a special software application or bot that would strip a player's character of valuable items including credits, weapons and protection. He would later sell these items on auction websites. The transactions were completed in the game, with the hacker meeting the buyer at a designated place to transfer the stolen goods, according to the Japanese newspaper Mainichi.

Victims who encountered the hacker's bot thought they saw a regular fellow gamer. But as the two would engage in a fight, the bot proved invincible and would leave the player unable to continue playing the game.

"Bots are the biggest problem we face with Lineage II," said Mike Crouch, PR manager for NCSoft, the maker of the game. "We kick people out if they use bots. "

He added that the company scans for bots when players sign up for a game session. Citing an ongoing legal investigation, Crouch was unable to comment on the case in Japan.

Shelley Olhava, program manager for games at analyst firm IDC, said she was not surprised by the incident.

"Shady things happen in the world of online games," she told vnunet.com.

She stressed, however, that this qualified under the category of people cheating in games and that only a small group of players resorted to such tactics.

Lineage II is a so-called 'massive role playing game' with more than 2 million players worldwide. Players roam around in online virtual worlds, completing tasks for credits or items that increase their power. Gamers are charged a monthly fee of $14.95 to access the game.

A shadow economy has emerged around these games with gamers trading items, credits and complete characters on Ebay or IGE.com. At IGE.com it is currently possible to purchase a '62 Male Elven Spellsinger' with 'amazing skills' for $623.69, and the game's 'Adena' currency goes for $13.99 per five million. The website is a market place for virtual gaming items.

In June a Chinese man was reported to have murdered a fellow player of the game Legend of Mir III after he sold his virtual sword without the owner's consent. 

The Chinese exchange student did not break any laws by stealing the virtual items, as there are no laws to protect such non-tangible property. He could, however, be charged with hacking into the online game.