Indian financial crime regulator launches probe into Philip Morris

Indian financial crime agency the Enforcement Directorate has launched an investigation into tobacco giant Philip Morris and its local partner Godfrey Phillips for alleged violation of the nation's laws.

Earlier in the week, news that the Enforcement Directorate had been looking into both companies broke, but on Friday, reports that the scope of its investigation was much broader than the alleged foreign investment law violations highlighted earlier indicated.

According to internal company documents, Philip Morris has paid manufacturing costs to Godfrey Phillips to make its Marlboro cigarettes in-country for several years now, circumventing an almost ten-year-old government ban on foreign direct investment in the industry, something an Enforcement Directorate source told Reuters was "already under investigation".

Both firm's had previously claimed their business arrangements were in "are in complete compliance with the extant regulations" covering Indian foreign direct investment laws.

As of 1230 GMT, Philip Morris shares had slipped 1.03% to $86.07 each in pre-market trading.