HANGZHOU, Feb. 21 (Xinhua) -- Chinese e-commerce giant Alibaba said Monday its chief executive officer and chief operating officer had resigned after a probe found many suppliers had defrauded online customers.

David Wei and Elvis Lee resigned as CEO and COO respectively, accepting responsibility after 1,107 of its suppliers were terminated for using the site to cheat buyers in 2010, the company said in a statement to media organizations.

"Alibaba will definitely not become a money machine, and any behavior that runs against the company's values will not be tolerated," the notice said.

"Integrity is the foundation of values that Alibaba cherishes most, which include the integrity of the staff and a honest and safe online trading platform," said founder and non-executive chairman Jack Ma in a letter to his employees.

The company had received complaints about fraudulent trading since 2009, and such cases continued to be reported despite Alibaba's efforts including shutting down suspected suppliers, according to the notice.

Alibaba launched an investigation more than a month ago, which showed that 1,219 suppliers in 2009 and 1,107 suppliers in 2010, accounting for 1.1 percent and 0.8 percent of its total suppliers in the two years respectively, had acted fraudulently.

Their accounts have been closed and judicial investigations started.

The statement said nearly 100 sales representatives who had allegedly collaborated with or failed to properly assess the defrauding suppliers had been fired or received other penalties.

The 2,326 fraudulent suppliers offered popular consumer electronics at very low prices on the site, required small minimum order quantities and traded by less reliable payment methods, the company said.

The average payment by buyers was less than 1,200 U.S. dollars, it added.

The fake suppliers had paid about 40 million yuan in registration fees to Alibaba.

Ma said he had been disappointed and angry over the past month.

"Tolerance of behaviors that broke the bottom line of the company's values is a crime against honest suppliers and employees, and we must take actions to safeguard Alibaba's values," Ma said.

"I admire the resignation of Wei and Lee and am grateful for their unremitting efforts to the company... this is the growing pains and we have no other choice," he said.

Ma said courage and taking responsibility was the nature of Alibaba people.

He hoped that the incident could serve as an example to other companies if they encountered similar problems.

"I resigned to fulfil our commitment to our customers and to help the company continue in a healthy way," Wei said.

"A listed company should not give up doing the right thing just for gaining business achievements," he stressed.

Jonathan Lu, 41, will take over as CEO of Alibaba.com Ltd. which is listed in Hong Kong and based in Hangzhou, capital of east China's Zhejiang Province.

Alibaba said its vice president of human resources Deng Kangming had also resigned and Lucy Peng, CEO of Alipay.com, will take over his post.

The company said more efforts will be made to find out possible problems in the operation of its mechanism to prevent similar incidents.

The company's core financial operations had not been affected by the fraudulent suppliers, it said.

Source:Xinhua