The biopharmaceutical arm of Samsung Group, Samsung BioLogics, has been found to have breached accounting standards and inflated its profits.
As a result, trading of the company's shares on Korea's benchmark KOSPI has been immediately suspended.
Also, the company will be subject to punitive examination for delisting.
South Korea's Securities and Futures Commission said Wednesday that it found the company had intentionally inflated its profits in 2015.
Meanwhile, Samsung BioLogics denied any wrongdoing saying it reflected different accounting standards in the event its unlisted joint venture Samsung Bioepis exercised its call option.
Samsung BioLogics is owned by tech giant Samsung Electronics and Samsung C&T, of which Samsung Electronics Vice Chairman and the Group's heir, Lee Jae-yong, is the biggest shareholder.
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