On July 24, the Seoul Metropolitan Police Agency’s Financial Crimes Investigation Unit executed a search and seizure at HYBE’s headquarters in Yongsan, Seoul. The action stems from allegations that Bang Si-hyuk engaged in fraudulent transactions in violation of the Capital Markets Act.
According to reports, Bang Si-hyuk allegedly misled early investors and venture capitalists by claiming there were no plans for an IPO (Initial Public Offering) while secretly arranging to sell HYBE shares to a private equity fund (PEF) established by an acquaintance. This PEF later generated significant profits—reportedly worth around ₩400 billion (approximately $288 million USD)—a portion of which Bang Si-hyuk was contractually entitled to share. Crucially, this side agreement was omitted from HYBE’s official securities filings.
The case, initially investigated by the Financial Services Commission, was recently handed over to the Seoul Southern District Prosecutors’ Office. Despite HYBE’s assertion that Bang Si-hyuk had cooperated fully with authorities and had not pursued personal gain based on the company’s public listing, the regulatory body remained unconvinced and proceeded with formal accusations.
Adding to the confusion, the involvement of the Financial Supervisory Service’s special judicial police unit has sparked jurisdictional ambiguity about who should lead the investigation.
HYBE responded to the developments, stating: “It’s unfortunate that our chairman’s efforts to clarify misunderstandings were not fully accepted. We respect the ongoing investigation and will actively cooperate to restore the market’s and stakeholders’ trust.”
As investigations continue, the scandal casts a shadow over HYBE’s previously stellar corporate image and raises larger questions about transparency and ethics in the business side of K-pop.
Nate
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