Netflix Inc.
What Happened: The offices of the streaming giant were searched by investigators on Tuesday morning as part of a preliminary inquiry into alleged tax fraud and money laundering, reported Reuters.
The investigation, led by the French National Financial Prosecutor's Office (PNF,) is focused on potential financial crimes and corruption. The probe, which began in November 2022, has led to searches at Netflix's offices in central Paris and its European headquarters in Amsterdam.
A preliminary investigation in France does not automatically indicate that criminal charges will be filed or that a trial will occur.
Dutch authorities were simultaneously searching Netflix's European headquarters in Amsterdam, according to the French judicial source. Neither Netflix France nor Netflix Netherlands have released a statement.
Netflix did not immediately respond to Benzinga's request for comment.
Why It Matters: In 2022, Netflix settled a tax dispute with Italy by paying 55.8 million euros ($60.78 million). The company, which opened its Paris office in 2020, produces most of its original films and series by working with third-party contractors.
This investigation comes at a time of significant change within Netflix. The company recently restructured its leadership, with the departure of two key executives, Rachel Whetstone, chief communications officer, and Dean Garfield, VP of public policy. This restructuring was part of a planned change announced by Co-CEO Ted Sarandos.
Price Action: Netflix stock, which has gained 61.26% so far this year, was down 0.2% during premarket trading on Tuesday, according to Benzinga Pro data.
