The financial authorities have decided to file charges against HYBE's Chairman Bang Si-hyuk for allegedly violating the Capital Market Law. He is accused of deceiving existing investors by denying any plans for an IPO, then allowing them to purchase stocks through a private equity fund, ultimately netting a profit of approximately 200 billion won.
On the 8th, the Capital Market Investigation Deliberation Committee under the Financial Services Commission set this course of action and conveyed their opinion to the Securities and Futures Commission. If the Commission confirms this, Chairman Bang and three other current and former executives of HYBE will also be targeted for prosecution.
The financial authorities focused on the fact that around 2020, when Chairman Bang was preparing for HYBE's IPO, he signed a contract with a private equity fund established by close associates, agreeing to transfer over 30% of the equity profits.
Subsequently, Chairman Bang's side reportedly told existing investors that there were no plans for an IPO, encouraging them to transfer their stocks to this private equity fund, which then sold the stocks post-IPO for a profit of around 200 billion won.
The authorities have labeled this as "using a private equity fund to circumvent lock-up agreements and causing harm to general investors," deeming it a "serious market disruption."
As the controversy escalated, HYBE expressed regret through an official statement in the afternoon of the 8th, committing to fully cooperate with the authorities' investigation.
HYBE stated, "We apologize for causing concern related to the IPO process. We are actively cooperating with the financial authorities and the police by providing detailed explanations and documents regarding the issues raised. We will diligently demonstrate that the IPO was conducted in compliance with laws and regulations, no matter how long it takes."
Meanwhile, this action is expected to be the first prosecution under the "one strike, you're out" policy of the Lee Jae-myung administration, aimed at strongly punishing stock manipulation and unfair trading practices.
(SBS Entertainment News | Kang Kyung-youn)