DETROIT- A 28-year-old computer consultant was arrested here Monday for his suspected involvement in the case of a California teenager who used a Webcam to start his own online pornography business.

The consultant, Ken Gourlay of Detroit, is being held on a $500,000 cash-only bail and faces 10 felony charges, including criminal sexual conduct, contributing to the delinquency of a minor and distributing child pornography. If convicted, he faces up to 20 years in prison.

The arrest of Mr. Gourlay signals a new front in the government’s response to the revelation that minors have been using Webcams to run their own child pornography Web sites, one that could have a crippling effect on this once-burgeoning business.

Justin Berry, now 19, has accused Mr. Gourlay of luring him to Michigan when he was 13, molesting him and setting up a Web site that charged a monthly fee for videos of him performing various sex acts.

In December, a front-page article in The New York Times described Mr. Berry’s involvement in the underworld of Webcam child pornography, and the case has generated national interest. Last month, Congress held hearings on the issue.

Mike Cox, the Michigan attorney general, said Monday that after reading the Times article and learning that Mr. Berry had been abused in Michigan, he began investigating Mr. Gourlay.

Last week, law enforcement officials searched Mr. Gourlay’s home in Detroit and seized multiple computers. One of them, state officials said, had thousands of pornographic images on it. That computer was owned by Edward Mulak II, 24, Mr. Gourlay’s roommate, who was arrested on charges of possessing child pornography, they said.

“It’s a parent’s worst nightmare,” Mr. Cox said. “An adult reaches into a home and pulls the child out.”

The Times article on Mr. Berry revealed that at least hundreds of teenagers had created sites similar to his, with help from Web hosting companies that accept a lucrative cut of their revenue in exchange for access to the servers needed to operate the site. That is the service Mr. Berry said was provided to him for some of his earliest sites by Mr. Gourlay and his Web hosting company, Chain Communications.

The action by the Michigan attorney general has made clear that law enforcement officials could view a Web hosting company as being in the business of promoting and distributing child pornography. If such companies refused to provide support to child Webcam sites, most of them would probably vanish.

At the Congressional hearing, Mr. Gourlay took the Fifth Amendment and declined to comment. His lawyer, James C. Howarth, could not be reached on Monday.

Mr. Berry has identified as many as 1,500 men who gave him money and gifts to perform on camera. In January, one of the men, Gregory J. Mitchel of Virginia, pleaded guilty to four felony counts involving the production, sale, distribution and possession of child pornography.