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Other children were lured into the homes of neighbors and forced to perform sex acts in front of webcams, they said.Sitoy said the trade thrived because children were locked secretly inside homes, as well as Ibabao's remote location and the fact some elected village leaders with relatives involved ignored the crimes.

The British man was convicted in March last year and sentenced to eight years in prison.

Shortly afterwards police in the Philippines began carrying out raids in Ibabao and nearby areas with the help of British, Australian and US authorities.

One of the raids saw dozens of Filipino police and social workers break into the bungalow next to the day care centre in September last year, arresting a couple and rescuing their three children, aged three, nine and 11.

Two days later, 13 other children who were being abused in other Ibabao homes were rescued, according to Philippine police.

The now abandoned house that used to stream live sex acts of children to pedophiles watching online overseas, is seen in the village of Ibabao in Cordova town, Cebu, Philippines on January 21, 2014.

Ted Aljibe/AFP CEBU, Philippines – In a remote Philippine village, toddlers played oblivious at a nursery as the house next door became part of a horrifying child pornography ring, with live footage of children performing sex acts being streamed online to pedophiles around the world.

The depraved scenes in the bungalow were being repeated in many homes throughout Ibabao, a secluded community on Cebu island where Internet child pornography had for some of its 5,000 residents become more lucrative than fishing or factory work.

"In the beginning I was shocked, I could not believe this was happening in my town," mayor Adelino Sitoy told Agence France-Presse last week, shortly after police announced they had cracked a global live-streaming pedophile ring in which Ibabao was a key source of the child pornography.

But while the village is currently in the spotlight, authorities and child rights advocates say the fast-growing global industry is infecting many parts of the mostly poor Philippines, with thousands of children having been abused.

At first look the coastal community of Ibabao, 550 kilometers (340 miles) south of Manila, is a typical close-knit rural Philippine village, where many of the long-time residents are relatives or enjoy close and longstanding ties.

In scenes echoed across the devoutly Catholic Philippines, its residents regularly attend masses held in quaint chapels along narrow footpaths and dirt roads.

Parents sell children for online sex But police and authorities said that behind the closed doors of the tiny wooden and brick homes, many parents directed their children for sex videos in front of webcams connected via the Internet to paying pedophiles overseas.