Japanese share prices are in chaos following revelations that internet company Livedoor is being investigated by Tokyo prosecutors for market manipulation [WAMN: 18-Jan-06].
For the first time in its history the Tokyo Stock Exchange closed early on Tuesday in a bid to head off a meltdown after a frantic day's trading.
The country's Nikkei 225 index closed down 464.77 points, or 2.94%.
Livedoor, one of Japan's best known online businesses, saw its own shares suspended temporarily following a newspaper report that it had falsified its 2004 earnings.
In a statement sent to the stock exchange on Wednesday, the company said: "We will make utmost efforts to investigate the fact and will report as soon as we conclude."
The newspaper report in the Yomiuri Shimbun, citing unnamed people, claimed Livedoor "window-dressed" its accounts by transferring profits from three affiliates to cover a ¥1 billion ($8.6m; €7,1m; £4.9m) deficit.
The company's offices were raided on Monday by prosecutors looking into allegations that it misled investors to boost its share price by announcing last October it intended to acquire a publisher ... despite the fact that it already owned it.
NEWS FLASH: 07.12 GMT
Executive Linked to Livedoor is Found Dead
The murk eneveloping Livedoor thickened Wednesday evening with the discovery of a body in an Okinawan hotel room. According to local police, suicide is suspected.
The corpse is believed to be that of Hideaki Noguchi, vice president of H S Securities, a company linked to Livedoor and raided earlier this week by Japanese fraud prosecutors. Noguchi is also said to be a former executive of Livedoor's forerunner On the Edge.
HSS denies any malpractice, as does Livedoor.
Asserts HSS president Hideo Sawada: "We find [the suicide] regrettable and feel a heartbreaking grief."
Data sourced from multiple sources; additional content by WARC staff