A taxi carrying the banner of Kakao T ride-hailing service passes Seoul Station in this Nov. 2, 2023, file photo. Yonhap

The financial regulator on Wednesday decided to fine Kakao Mobility, the operator of Korea's most-used taxi-hailing service provider, 3.46 billion won ($2.48 million) for its alleged accounting fraud.

The Financial Services Commission (FSC) approved the penalty, initially imposed by the Securities and Futures Commission under its arm earlier this month, on Kakao Mobility for allegedly inflating revenues in preparation for a stock market debut.

The FSC also decided to levy a 692.4 million-won fine combined on company chief Ryu Geung-seon and a former chief financial officer and to refer the case to the prosecution for a further probe.

The company allegedly had added commission fees it received from taxi drivers to operating profits, while registering partnership fees it paid to drivers as operating expenses, in its 2020-2022 financial statements in violation of due accounting regulations, according to the regulator.

The FSC's decision came a month after the Fair Trade Commission, the antitrust regulator, fined the company 72.4 billion won for allegedly demanding competing taxi franchise operators sign partnership deals and blocking their access to its taxi-hailing services, Kakao T, in case of rejecting the offer. (Yonhap)