Financial regulator to begin review of Samsung Biologics' alleged accounting fraud

By Yonhap
  • Published : May 6, 2018 - 16:16
  • Updated : May 7, 2018 - 09:28

South Korea's financial regulator said Sunday its accounting oversight panel will hold the first meeting on Samsung Biologics Co.'s alleged violation of accounting rules next week.

The Accounting Oversight Deliberation Committee under the Securities & Futures Commission will hold the meeting on May 17 and review the issue, according to the Financial Service Commission. The SFC, a subcommission of the financial regulator, is responsible for the oversight of the securities and futures markets.

Samsung BioLogics executives speak during an emergency press meeting held on May 2 at the Korea Chamber of Commerce and Industry.

Last week, the Financial Supervisory Service (FSS) tentatively concluded that the bio unit of Samsung Group has violated accounting rules, adding that corrective measures and punishment may be taken depending on the final outcome.

The bio firm's alleged accounting flaw boils down to whether there were any irregularities over its dramatic business turnaround in 2015. Samsung Biologics, listed on the local stock market in November 2016, reported a net profit of a whopping 1.9 trillion won ($1.76 billion) in 2015, shifting from a loss in the previous four years.

FSC Vice Chairman Kim Yong-beom, who leads the SFC, has asked the deliberation committee to promptly review the matter and submit the results to the SFC.

Accordingly, the financial regulator's final conclusion on the matter could come out on May 23 or June 7 when the SFC's regular meetings are scheduled.

The share price of Samsung Biologics nosedived 26.3 percent over the last three trade sessions, losing a whopping 8.5 trillion won in terms of market cap. (Yonhap)