Offices of Mitsubishi Motors have been raided in Japan and its share price has dived for a second day after the company admitted faking fuel economy tests on some of its cars.
Officials from the Japanese transport ministry entered the research and development centre in Nagoya and a number of other buildings in the country as investors fled Mitsubishi's stock.
Shares were down more than 20% on Thursday after losing 15% in the previous session.
It meant about $2.5bn (£1.74bn) had been wiped from its market value in just two days.
Wednesday's decline took place before the company confirmed reports about its misconduct .
After the markets closed, it admitted 157,000 of its own brand eK Wagon and eK Space models and 468,000 vehicles produced for Nissan were affected by the cheating.
Nissan, the company said, had alerted it to discrepancies in fuel efficiency readings and its internal investigation had identified methods used to give a false impression of a model's fuel economy.
Mitsubishi said all 625,000 cars were built since mid-2013 and sold in the Japanese market only.
The Nissan-branded vehicles involved were the Dayz and Roox models.
The announcement represented another scandal for an industry still reeling from the fallout of the diesel emissions cheating at VW - due to reach court in the US later on Thursday .
Mitsubishi said it still had avenues to investigate over whether its fuel economy cheating was more widespread than first thought.
The Japanese authorities have given the firm a week to submit a detailed report on the matter.
The company has been no stranger to scandal in the past.
In 2004 it teetered on the edge of bankruptcy amid a series of huge recalls linked to a cover-up on historic defects including failing brakes and faulty clutches.