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South Koreans arrested for spreading rumours to manipulate the stock market

False rumours about a nuclear accident in North Korea caused the stock market to tumble

Skorea kospi arrest 12 02 21Enlarge
South Korean stocks plunged on Jan. 6 amid rumours of a nuclear accident in North Korea. (JUNG YEON-JE /AFP/Getty Images)

Six people in South Korea have been arrested for rigging share prices by spreading false rumours about a nuclear accident in North Korea.

Bloomberg quotes a statement from the National Police Agency confirming the arrests, which they said included two office workers and a 19-year-old university student.

The group are accused of using online messaging services to tell market analysts and brokers that a light-water reactor had exploded in North Korea on Jan. 6, causing a radiation leak.   

The claims were baseless, but the Cyber Terror Response Centre said they allowed the group to make 61 million won (US$54,314) in profits amid the scramble to move financial markets. 

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Singapore's Strait Times and AFP report that the messages caused share prices to fall by more than 2% and the South Korean won fell 0.88% cent against the US dollar. 

The dramatic declines prompted the South Korean financial regulator and stock exchange to investigate suspicions of "unusual trade".

On Tuesday, South Korean police said: “We will continue to strictly probe stock price manipulation crimes aimed at disrupting equity-market order and doing harm to investors . . . The police and the Financial Supervisory Service will keep expanding the investigation.” 

Earlier, AFP reported that three members of the group also pocketed 32 million won in early February, by spreading rumours that a new vaccine had been developed.

More from GlobalPost:  Asian markets and the won decline after Kim Jong Il's death

  

http://www.globalpost.com/dispatch/news/regions/asia-pacific/south-korea/120221/south-koreans-arrested-spreading-rumours-manip