The arrests were made after an investigation uncovered 15,000 pieces of false military equipment, including imitation guns, uniforms, logos and other items that were labelled "military use only," state-run Beijing News reported.
The IDs, including the high military ranks of generals, were sold for as much as 15 million yuan (USD 2.28 million).
"We'll put every effort into fighting against these criminals. In fact, some of the counterfeit military equipment, such as the imitation guns and uniforms can still be found quite easily on China's online platforms," state-run Global Times reported.
In a three-month campaign against fake IDs, which started in July, two imposters posing as a general and a senior colonel of the 2.3-million strong People's Liberation Army (PLA) were held.
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They would boast to possible clients that 15 million yuan could buy them the rank of senior colonel, the report said.
On China's largest online shopping website taobao.com, people can easily get fake or second-hand military goods, with prices varying from 14 yuan to 3,000 yuan.
The fake military ID scandal came amid massive anti-graft crackdown launched by Chinese President Xi Jinping in which over 40 top ranking generals and 13,000 other personnel have been punished.
They were accused of selling top posts of the military to the highest bidder.
Guo was sentenced to life imprisonment in July last year and Xu died of cancer at the age of 72 in 2015 while in custody and under investigation for graft.
In August 2016, a 46-year-old man was sentenced to 14- and-a-half years in prison for scamming 3.24 million yuan by pretending to be a soldier, the report said.
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