The defence ministry said on Tuesday that last month security officials raided the Seoul branch of the Swedish firm as well as the Security Management Institute, a private organization with access to key defence information.
“The raid, which was to secure evidence, followed allegations of bribery,” a ministry spokesman told AFP, without disclosing details.
The Swedish defence contractor is suspected of bribing the institute to obtain information regarding a military project to develop new fighter jets, Yonhap news agency said.
Saab has been interested in the project, Yonhap said, adding its potential competitors include US firms Boeing and Lockheed Martin.
A representative from Saab said the company was unaware of having been targeted in the probe.
“We haven’t received any indication that there is any connection at all indicating we might have paid for some sort of information,” Saab spokesperson Cecilia Schön Jansson told Sweden’s TT news agency.
According to her, none of the three employee’s in Saab’s Seoul office, one of whom is a Swede, are suspected of any crime.
Yonhap quoted Kim Jong-Tae, commander of the Defence Security Command, as saying security authorities were questioning six people.
“The investigation should end at the end of October,” Kim was quoted as saying.
Investigators suspect the institute has presented reports on the fighter project to parliament in favour of Saab, Yonhap said.
South Korea hopes to secure more than 100 new fighters by 2020 to better counter threats from its neighbours. It has purchased 40 F-15Ks from Boeing and plans to buy 21 more by 2012.