South Koreans jailed over 'Russian treasure find'

Treasure-seekers have spent years hunting for the Dmitrii Donskoi

A South Korean court has sentenced three business executives to prison after finding them guilty of falsely claiming they had found a long-lost treasure-laden shipwreck.

Shinil Group said in July it had found the Russian cruiser Dmitrii Donskoi, which sank in 1905 and was rumoured to hold gold worth billions of dollars.

The company attracted 8.9bn won ($7.6m; £5.8m) from thousands of investors.

But suspicion spread that it might have been a scam. The group did not comment.

The Shinil Group claimed that the Donskoi contained around 200 tonnes of gold but a Seoul court on Wednesday found this to be a lie.

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A vice-chairman of the group, identified only as Kim, was issued a five-year prison term, while the former head of the group, whose family name is Ryu, and another key accomplice were sentenced to two years and four years in prison, respectively, according to Yonhap news agency.

"Their responsibility for the crime is very heavy, given the method and scale, as it's a case where they swindled many unspecified people and took huge gains," Judge Choi Yeon-mi said in court.

Shinil Group says this is the nameplate of the sunken Donskoi

The Dmitrii Donskoi was scuttled by its crew in 1905 after Japan's victory in the Battle of Tsushima - a key moment of the Russo-Japanese War.

Ever since, rumours have persisted that the ship was carrying a large amount of gold for Russia's Pacific Fleet, to pay crew salaries and docking fees.

If true, the gold on board would be worth billions of dollars today.

Experts have raised doubts that Russia would ever have put that much gold on a single vessel, when it could have carried the precious cargo more safely by rail to its eastern port of Vladivostok.

How did the story unfold?

Suspicions were swiftly raised over Shinil Group after its claim.

South Korean news website Chosun Biz reported that the group was only founded in June, even though it says it is the successor company to Shinil Corporation, formed in 1957.

Moreover, the company was reportedly only formed with about 100m won not even enough to apply for salvage rights, which are 10% of a find's estimated value.

The cruiser was scuttled near Ulleungdo

The firm was accused of artificially boosting share prices, or seducing investors into buying a crypto-currency issued by a Singaporean company, also named Shinil Group.

Choi Yong-seok, CEO of the South Korean company, had insisted the two firms were unconnected - though their founders are siblings.

Yonhap reported that the ship's alleged treasure was initially claimed to be worth 130tr won but in subsequent documents for the excavation approval the value was lowered to 1.2bn won.