Swedish police have been alerted to a fraudulent press release which claimed Samsung had paid $650m (£407m) to buy a company developing fingerprint scanning technology.

Shares in Fingerprint Cards, a Stockholm based group developing similar capacitive touch sensors to those found in Apple's latest iPhones, were suspended after rising 50% during morning trading on Friday.

The company is developing scanners which can be embedded in smartphones and tablets and are already on trial with Microsoft. There have been suggestions its technology could appear in Samsung's next flagship phone, the Galaxy S5, when it is released next year.

At 10.30am on Friday, a press release with the headline "Samsung Electronics to acquire Fingerprint Cards AB" was widely circulated by the public relations news distribution company Cision.

The release quoted the Samsung's co-chief executive Kwon Oh-hyun, and Johan Carlström, who heads Fingerprint Cards. It claimed the company had been acquired for $650m in cash and would become a business division within Samsung.

The firm's shares rose from 26.50 (£2.60) Swedish Krona to 79.25 before being suspended. At 10.55am Cision rushed out a statement to the investors claiming responsibility for distributing the release, but saying its contents were "incorrect", and apologising to Fingerprint Cards and other stakeholders.

By 11.30am, Calström had put out his own statement, denying his company had been acquired by Samsung. "The previous press release was not sent by Fingerprint Cards AB," he stated. "What has happened will be reported to the police and to the Swedish Financial Supervisory Authority". A representative for the company declined to comment further.

Samsung described the story as "market rumour", suggesting Fingerprint Cards may have been the victim of a sting designed to ramp the value of its shares.

The Gothenburg based company was believed to be close to a breakthrough that could transform its fortunes. Active since 1997, according to CrunchBase, it has had moderate success selling scanners to Chinese banks, which their employees use before major transactions.

While its current scanners are separate pieces of equipment that plug into computers, it was thought to be close to developing a reader that could be embedded behind glass on a smartphone or tablet.

With Apple having successfully pioneered the fingerprint as a biometric authentication in smartphones, Microsoft and Samsung are determined to use the technology in their own devices, and Fingerprint Cards has already been named as a Microsoft partner company.

Apple's scanner was developed by a small firm called AuthenTec, which it bought in 2012 for $356m, and the technology has so far proved more reliable than many similar products on the market.

Microsoft senior product manager Chris Hallum demonstrated a Fingerprint Cards scanner while showing off an early version of Windows 8.1, the next iteration of Microsoft's new touch-screen software.

"In windows 8.1, modernised access control is the big hero, that's where the biggest investment is, and biometrics is probably one of the first areas we're investing in," said Hallum. "With windows 8.1 we're going all in on fingerprint-based biometrics."

Like Apple's scanner, its technology does not require swiping, only responds to living fingers and, according, to Hallum "works every single time, right away".