Prosecutors have arrested the chief executive of Japanese Internet firm Livedoor, Fuji TV reported today.
Three other executives of Livedoor were also arrested, it was reported.
A prosecutors' raid on Livedoor a week ago caused chaos on the Tokyo stock market and sent prices plunging across the board.
Media reports have alleged Livedoor spread false information to investors, issued new shares to "acquire" firms already under its control and then sold them for a profit to embellish its accounts.