South Korea launches raid on Samsung subsidiary amid fraud probe

South Korean prosecutors investigating alleged accounting fraud yesterday raided the offices of Samsung’s biopharma unit and its two auditors, KPMG and Deloitte.

The Financial Services Commission, which last month suspended trading in Samsung Biologics shares, claims the company intentionally breached accounting rules before listing in 2016.

Biologics, which denies wrongdoing, said today that investigators had entered its office, searching for evidence in the probe.

The company has launched a lawsuit against the Financial Services Commission, saying it is innocent of the allegations.

The operator of Korea’s stock exchange said two weeks ago it was considering whether to force the firm to delist.

But on Monday the Korea Exchange concluded that it would not ban the company from the public market, and trading in its shares started again on Tuesday.

In May, shares in Samsung Biologics plunged close to 20 per cent, wiping almost $6bn off its market value after the regulator levelled allegations against the company.

It has been coy about what exactly it suspects Samsung and its two auditors of.

Shares in Samsung Biologics were trading up 3.9 per cent to 410,000 Korean won.

Samsung is the largest family-owned business in South Korea.

Deloitte and KPMG in South Korea could not be reached for comment.