‘Treasure ship’ find ignites gold fever

Caution urged over claim of $170B discovery

TOKYO • A company claiming to have found one of the most valuable shipwrecks in history off the coast of South Korea has sparked gold fever among investors — and warnings from the country’s financial regulator. The Shinil Group claimed this week to have found the Dmitri Donskoi, a Russian warship scuttled by her crew in 1905 during the RussoJapanese War.

The ship, it was said, was carrying the funds of Russia’s Second Pacific Squadron, and sank with 5,500 boxes of gold bars and 200 tons of coins still in its hold, worth a little over $170 billion.

But questions have been raised about the treasure. South Korea’s financial regulators have warned investors to be wary of sinking their savings into companies behind the venture. Shares in Jeil Steel soared 30 per cent on Tuesday, the day that the discovery was announced, apparently because Ryu Sang-mi, the head of the Shinil Group, is the secondlargest shareholder in the company. The shares then fell by 20 per cent on Thursday and another 30 per cent Friday. The Shinil Group is not listed on the South Korean stock exchange.

“Concerning the treasure ship salvage project, investors’ discretion is recommended as there are risks of them suffering great losses if they rely on rumours,” the Financial Supervisory Service said.

South Korean media have also raised questions about the Shinil Group. Several of its affiliated firms are not registered with the South Korean authorities, and recent calls to the company have gone unanswered. One suggestion reported by The Korea Times is that the announcement of the discovery of a ship laden with gold is linked to the Shinil Group’s cryptocurrency operations. A website set up under the Shinil Group’s name described a newly launched Donskoi International crypto currency exchange as linked to the find.

The website said it would “share profits” from the wreck with the public by handing out its virtual currency to anyone who signed up to use the exchange. It promised additional coins to those who helped sign up others. The Shinil Group has denied that the website is affiliated with the company.

The Shinil Group was founded on June 1, with assets of 100 million won ($116,400). Reports say that it has not received permission from the South Korean government to salvage the wreck.