Financial Authorities Proceed with Celltrion Case Discussion Using Lay Judge System

[Asia Economy Reporter Lee Jung-yoon] The Securities and Futures Commission (SFC) under the Financial Services Commission, which has begun reviewing the allegations of accounting fraud against Celltrion, decided to hold regular meetings with an adversarial hearing system to provide an opportunity for explanation.

According to the Financial Services Commission on the 9th, SFC members are discussing after receiving materials summarizing the results of the Celltrion audit by the Audit Committee. It is also known that the Celltrion audit results may be submitted as an agenda item at the SFC regular meeting in two weeks. Furthermore, if submitted, a conclusion could be reached within two months.

The regular meeting will proceed under the adversarial hearing system at Celltrion's request. The adversarial hearing system is a procedure where the target company is required to appear at the meeting to provide an opportunity to defend against the allegations, conducting the review in a manner similar to a trial. If the financial authorities present evidence of accounting fraud, Celltrion and its lawyers will rebut, and the SFC members will make a decision. This system was first applied in the accounting fraud cases of Hanla Heavy Industries (agenda submitted in April 2018) and Samsung Biologics (agenda submitted in May 2018).

However, although the adversarial hearing system provides sufficient opportunity for the company to explain, it takes a long time until a resolution is reached. In the Samsung Biologics accounting fraud case, it took nearly six months to reach the final conclusion of "intentional accounting fraud" after five regular SFC meetings and a re-audit by the Financial Supervisory Service. A Financial Services Commission official said, "Since the market impact is significant, we intend to issue a position as quickly as possible, but how long it will take to reach a conclusion depends on the discussions."

This content was produced with the assistance of AI translation services.