Accounting Fraud

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South Korea's main stock exchange has decided that Samsung BioLogics is qualified for continued listing on the local stock market, after authorities ruled that the firm intentionally violated accounting rules. Its shares resumed trading on Tuesday but legal controversy is expected to continue over its accounting fraud.

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Trading of Samsung BioLogics shares that had been suspended for more than 3 weeks resumed Tuesday. Following deliberations on a possible delisting, the Korea Exchange has decided to maintain the firm's listing. This comes 19 business days after its trading was suspended on November 14th after the Financial Services Commission ruled that Samsung BioLogics intentionally violated accounting rules ahead of its initial public offering in 2016. The Korea Exchange said that despite shortcomings regarding managerial transparency, it considered diverse factors such as corporate sustainability and financial stability. Pundits believe the decision would have also factored in the company's 80-thousand foreign investors and minority shareholders who own five trillion won of its shares. Also, there hasn't been a precedent where a firm was delisted over accounting fraud. But some critics say the Korea Exchange reached a hasty decision as Samsung BioLogics has yet to implement any measures since it was found to have engaged in window dressing of accounts worth some 4.5 trillion won.

[Soundbite] Kim Gyeong-yul(People's Solidarity for Participatory Democracy) : "I wonder whether the hasty decision to allow trading will serve to protect investors or put them at risk of a speculative market."

Samsung refused to accept the ruling on accounting fraud and has filed an administrative lawsuit. The Seoul Administrative Court will hold its first questioning on the case on December 19th.