Reports of sunken gold worth $125 billion that South Korean company Shinil Group claimed to have discovered last month drew the attention of investigators.
Police in Seoul raided the company's offices Tuesday morning, days after it emerged that Shinil was under investigation on suspicion of fraud and that senior company officials had been banned from leaving the country, CNN reported.
The firm drew global attention last month, when it claimed to have discovered the sunken Russian warship, the Dmitri Donskoii, which is rumored to contain an enormous cargo of gold.
The ship went down during the Battle of Tsushima 113 years ago, in the waters between present-day South Korea and Japan.
It has been alleged that gold on board the ship could be worth $125 billion. Shinil later downgraded the amount to $8.9 billion after claiming to have discovered the treasure, but, while the company teased that it would share photos and videos of the loot, nothing concrete was presented.
Meanwhile, shortly after news of the alleged discovery, a handful of stocks surged, including Kosdaq-listed Jeil Steel Manufacturing Co., Bloomberg noted.
Jeil Steel denied any link between the sudden uptick in stocks and the finding.
Financial regulators were reportedly investigating whether Shinil officials deliberately spread false information for stock market profit.
However, Cho Byung-Hyun, a strategist at Yuanta Securities Korea, told Bloomberg that "stocks like Jeil Steel Manufacturing and Dongwon Systems moved on the news, and most of the stocks are small caps."
He added that, even if Shinil had spread false information to make gains in the stock market, "there will be sensitive issues like ownership and whether this will indeed help earnings of companies."
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