Company Pours Cold Water on Sunken Treasure Frenzy
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Reporters wait for a press conference by the Shinil Group in Seoul on Thursday. /Yonhap
A company whose share price skyrocketed in recent weeks after it claimed to have discovered a sunken Russian ship with W150 trillion worth of gold on board has predictably backed off its claim (US$1=W1,123).
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Shinil Group had been enticing investors since the beginning of this year by saying it found the fabled missing ship off the coast of Ulleung Island. But once controversy escalated about its real aims, it fired several executives and distanced itself from the claim. It also emerged that the former head of the company has been indicted on a separate fraud charge.
Shinil Group CEO Choi Yong-seok in a press conference in Thursday said, "Some media outlets published speculative information without verifying it. We apologize for the irresponsible use of it".
The company said last week that it found the Dmitrii Donskoi, a Russian warship that sank off Ulleung Island during the Russo-Japanese War in 1905, and even screened underwater video footage. But Choi added, "We do not know where the W150 trillion claim came from".
Experts had cast doubt on the claim, saying there were no records that the Donskoi carried gold and that the Russian Navy voluntarily scuttled the vessel when its boiler malfunctioned.
But Shinil Group did not respond but continued to lure investors with the slogan "W150 Trillion Treasure Ship" on its official website. The company has now removed it from the website and replaced management.
The company also claims it has nothing to do with the cryptocurrency Shinil gold coin which had been sold using the alleged treasure as collateral. "The coins were sold by the Shinil branch in Singapore", Choi said. But a Shinil Group affiliate, Donskoi International Exchange, was in fact recruiting investors until recently.
A 48-year-old female executive surnamed Ryu, who had filed a trademark application for the cryptocurrency, did not show up at the press conference. She is rumored to be the sister of the 43-year-old chairman of the Singaporean branch.
Another 64-year-old executive surnamed Yoo was jailed for 10 months for fraud earlier this month. Yoo had been the CEO of Shinil Group and contracted a foreign salvage company to handle the search for the Donskoi. Before leaving the job in May, Yoo signed a business contract with a news outlet that published what it claimed were exclusive reports about the find.
Choi said, "I am the sole CEO now", and distanced himself from his predecessor.
Shinil still insists that the ship it found is the Donskoi, but doubt has been cast on that claim as well. It looks remarkably similar to a wreck found in 2003 by Dongah Construction, which caused a sensation back then but was not salvaged in the end.
Both Dongah Construction and the Korea Institute of Ocean Science and Technology believe the ship Shinil Group claims to have found is the same one they found in 2003 and the wreck still belongs to them.
Jin Gyo-joong, a former Navy rescue diver, said at the press conference that the rudder is different. But Yoo Hae-soo from the institute, who took part in the search in 2003, said, "The rudder can break apart as time passes. The ship... is identical to the one we found in 2003 considering its position and shape".
Investors are livid. One victim of the goldrush said, "Even today, the head of the cryptocurrency exchange said the value will keep rising and told me to wait".
Police have launched an investigation.