Canadian and U.S. investigators have cracked an international child pornography ring that featured live molestations of children streamed over the Internet.

"The behaviour in these chat rooms and the images ... are the worst imaginable forms of child pornography," U.S. Attorney General Alberto Gonzales told a Chicago news conference on Wednesday.

"We are not going to tolerate those who intend to harm our children."

A private Internet chat room, used worldwide to facilitate the trading of thousands of images of child pornography, was infiltrated as part of the sting.

Seven child victims of sexual molestation have been identified as a result of the investigation. The youngest victim in the images was just 18 months old, Gonzales said.

Nine of the 27 accused are from Canada, 13 from the United States, three from Australia and two from Britain.

The primary host was allegedly a user from Clarksville, Tenn., with the screen name G.O.D., who was arrested March 6.

Tony Warr, of Toronto Police Services, described the arrests as "a significant achievement."

Warr said he wanted the public to know "how well the international law enforcement community can work together by pursuing this investigation using different techniques."

All but one out of the 27 charged has been arrested. The one who remains at large is considered a fugitive, officials said.

The case began when an Edmonton woman overheard two children talking and reported their conversation to police, said Det. Randy Wickens of the city's Internet Child Exploitation unit.

That led to an arrest in Edmonton in May 2005. The man, whose name has been banned from publication, was sentenced to 14 years in prison.

Another man, 49-year-old Carl Edmond Treleaven, of Edmonton, was charged with distributing child porn in January after police raided his home.

He pleaded guilty last month and is scheduled to be sentenced Friday.

Undercover police in Toronto who were monitoring a chat room in 2005 targeted Treleaven and traced his Internet address to Alberta.

During a raid on his home, police allege they found more than 20 gigabytes of child porn on a computer -- including incest, bestiality and rape.

According to the agreed statement of facts, police say they found some 90 subscribers on Treleaven's computer. During the forty minutes they were inside the home, they say another 20 people logged on looking to download images.

Staff Insp. Jane Wilcox, commander of the Toronto police sex crimes unit, said besides the Edmonton arrests, there were two in British Columbia, two in Alberta, two in Manitoba, three in Ontario and one in Quebec.

They have been charged with various offences, including possession, receipt, distribution and manufacture of child pornography.

Porn becoming increasingly aggressive

RCMP Insp. Michelle Martin warned at a presentation to a public form that child pornography is becoming increasingly aggressive and violent.

"They are infants, they are not even walking and they are still in diapers," she said in Fredericton.

"And adults are having sexual intercourse with them. There are pictures with animals."

Martin, who heads a five-member Internet child exploitation unit based in Fredericton, said while such behaviour has been around for a long time, the Internet has made it easier to access.

"It's a $2.6-billion industry with 20,000 new child porn websites every month," said Martin.

A decade ago, the Toronto sex crime squad would seize about hundreds of photos a year. Last year, they seized more than 3 million pictures and videos, approximately 90 per cent of them from western nations.

Toronto police Det. Sgt. Paul Gillespie says much of that is thanks to Microsoft chairman Bill Gates, who helped Canada develop a specialized tracking system.

Gillespie, who heads Toronto's 17-member child exploitation tracking unit, emailed Gates in early 2003 and asked for help to create a tool to catch online pornographers.

Microsoft Canada responded by pumping $4.5 million Cdn into creating the Child Exploitation Tracking System, which was instrumental in dismantling the ring that was announced Wednesday.

"He's done an awful lot of good in the world," Gillespie said. "He recognizes that as much good as the Internet brings, it also brings the bad and Microsoft has to work closely with law enforcement."

The tracking system contains data gathered from international sources, allowing authorities to plug in an email address, credit card number or even an Internet nickname and see what information may pop up.

"It's being used all across Canada, we're presently in the very stages of development and deployment in six other countries around the world as we speak, and someday it will be a global database when the police officers all over the world can work together," Gillespie said, appearing on CTV Newsnet Thursday.

"It's time that law enforcement changed the fundamental thinking on how they do business. We have to work together collectively."

With files from The Canadian Press and a report from CTV's Sarah Galashan