French police raided the Paris office of the U.S. consulting firm McKinsey & Co. on Tuesday as part of investigation into suspected tax fraud, authorities and the firm said.

The financial prosecutor’s office launched a preliminary probe following a March report from the French Senate that alleged the consulting giant had not paid corporate taxes in France over the past decade.

McKinsey denied any wrongdoing, saying it complied with French tax laws and was cooperating with French authorities.

“We can confirm the Parquet National Financier visited on May 24 McKinsey’s Paris office where we have been cooperating in providing the requested information,” the company said in a statement.

Image: A police officer, with red armband, stands in the building hosting McKinsey & Company France, on May 24, 2022 in Paris.
A police officer, with red armband, stands in the building hosting McKinsey & Company France, on May 24, 2022 in Paris. Michel Spingler / AP

“McKinsey is cooperating fully with the French public authorities, as has always been the case. McKinsey reaffirms that the firm complies with applicable French tax and social security rules,” it said.

In a statement in April, McKinsey said it was surprised at the public focus on the company given that its work represented only 1 percent of government consulting spending.

McKinsey has come under scrutiny in Washington over its bankruptcy work, its consulting for opioid manufacturers and its work with state-owned enterprises in China and Russia

Some lawmakers say the firm’s track record suggests possible conflicts of interest but McKinsey denies any wrongdoing and says it has strict rules to avoid any conflicts.

Government contracts for private consultants, including McKinsey & Co., became an issue in the April presidential election in France. Opposition critics on the left and right accused President Emmanuel Macron’s government of wasting taxpayers’ money on international consulting firms. Macron won the election.

The French Senate report said consultant companies had access to high-level officials and exerted influence that was often hidden from view.  French government spending on consultants rose from 379 million euros ($405.57 million) in 2018 to 894 million euros in 2021, according to the report.

McKinsey has been operating in France since 1964 and its Paris office is located on the famed Champs-Elysees boulevard.

Gretchen Morgenson contributed.

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