PACER chief Deputy Director General Oscar Calderon identified the suspects as Alvin Tong, 25, of Del Rosario street, Pasay City and Joel An, 24, of Ermita, Manila.
Calderon said the arrested suspects were members of the syndicate headed by Rasswyn Tong and Michael Tong based in Pasay City. They are now subject of a manhunt.
The PACER chief said the suspects were arrested during an entrapment operation in Makati City following a formal complaint by extortion victim Brent Ching.
Ching said the two suspects threatened to burn his familys house should they fail to pay them P1 million.
"We had to find someone reliable to help us, we were advised to go to authorities when we received the threat last Feb. 1. On the same day, we coordinated with the police," he added.
Through the close coordination between the police and the victim, an entrapment was set up, leading to the arrest of the suspects.
Calderon said their investigation showed that the suspects had been involved in extortion activities for a long time.
Ching told police he received letters with 9 mm bullets and later a fragmentation grenade. The suspects had demanded P1 million in exchange "for protection."
"These suspects threatened to kidnap a member of his family should they refuse to pay," Calderon noted. "They are also behind a number of kidnapping-for-ransom incidents in Pasay City."
In last Fridays operation, Calderon said PACER operatives seized a car, mobile phones and other valuables belonging to the gangs victims.
Citizens Action Against Crime (CAAC) president Teresita Ang-See thanked the victims for their courage in coming out and reporting the extortion attempt.
"We thank the family for filing the complaint. Some criminals succeed in their criminal activities because victims simply pay and keep quiet for fear of retaliation," Ang-See said.
She said there have been at least 12 reported cases of extortion and the PACER is now trying to track down members of the gang.
Ang-See said some criminals also resort to "online extortion" like the case of Ryan Ty, who was victimized by a police officer.
"Ty reported the extortion leading to the arrest. We should emulate people like him to stop extortion. Why be afraid, they have no hostage," she said.
The CAAC noted that the modus operandi of the syndicate was to first send a letter with bullet, followed by a live grenade then increasing the magnitude of threat until the victim gives in," she said.
Ang-See advised the victims not to give, saying "crime pays only if we allow them."
"We should not allow these things to happen. We are asking the victims to come out. With the success of this case, we hope the trend continues," she said.