CHICAGO (CNN/Money) - Are past accounting sins catching up with Take-Two Interactive? Or is the company merely the hapless victim of rumor-mongering short sellers?

Take-Two, publisher of the ultra-violent gangster video game Grand Theft Auto III, has until recently been one of the strangest success stories of the bear market.

Investors desperate to get hold of shares in recent months were willing to ignore a veritable smorgasbord of troubling news about the company -- including a stock halt, restatement of seven (seven!) quarters worth of earnings, the departure of two chief financial officers in short order, and an ongoing SEC investigation into the company's accounting.

In this post-Enron age, one would expect the stock of such a company to plummet. In fact, the stock more than quadrupled from its September lows to an all-time high of more than $27 in early June. The surge is due in large part to the success of Grand Theft Auto III, which has sold more than six million copies since its release last October, making it the hottest title in a hot video game market.

Take-Two's seemingly inexorable upward climb has hit a snag, however, with the stock dropping dramatically after the company announced quarterly earnings June 6.

Though the company raised forecasts for the year, it lowered them for the current quarter. Meanwhile, rumors swirled on message boards that company president Paul Eibeler might be headed out the door.

The stock is down almost 25 percent from its peak, though it still is up more than 20 percent for the year.

When I spoke to CEO Kelly Sumner earlier this month, he assured me the company was working hard to put its sins behind it, cooperating with the SEC and taking steps, including a "forensic audit" by PricewaterhouseCoopers, to ensure its accounting is pristine going forward. Take-Two got into trouble in the first place for what critics call its practice of "selling to itself" -- that is, recognizing revenue from products that were later returned or purchased by the company. (The company disputes that characterization.)

"We've worked very hard to get to the bottom of this, to understand what went wrong and to ensure it doesn't go wrong again in the future," Sumner told me. As for the recent stock slide, he (quite prudently) wouldn't comment. "That's not for me to do," he told me.

Well, he's apparently changed his mind. On Monday, the company issued a press release titled "Take-Two Interactive Software, Inc. Comments On Recent Weakness in the Price of Its Common Stock." In it, the company complained that it had been "the subject of numerous false negative rumors in the financial community and on Internet sites over the past two weeks."

Eibeler implicitly addressed the rumors surrounding his possible departure, assuring investors that "the entire management team and Board of Directors, and I, are very committed to our ongoing roles at Take-Two."

While the press release apparently has inspired some to get back into the stock -- it's up a couple bucks since Monday -- the folks at Take-Two have their work cut out for them. While Take-Two and its fans have high hopes for the Grand Theft Auto III sequel, "Vice City," scheduled for release this October, critics think the current monster bestseller will be a tough act to follow.

"Grand Theft Auto saved them," says SoundView analyst Shawn Milne. "Can they replicate that? I doubt it." Throw in an SEC investigation on top of some pretty tough comparisons, Milne says, and you've got a recipe for disappointment -- or worse.

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