Amid allegations of defrauding investors for billions of won in profits during the listing process, the Seoul Metropolitan Police Agency has initiated a search and seizure operation at the headquarters of HYBE, with Chairman Bang Si-hyuk at the center of the investigation.
The Financial Crimes Unit of the Seoul Metropolitan Police Agency dispatched investigators to HYBE's headquarters in Yongsan-gu, Seoul, on the morning of the 24th. This action follows the Securities and Futures Commission, under the Financial Services Commission, filing a complaint against Chairman Bang for violating the prohibition of unfair trading practices under the Capital Market Act on the 16th.
Chairman Bang is accused of misleading investors in 2019 by stating there were no plans for an Initial Public Offering (IPO), then facilitating the sale of their shares to a Special Purpose Company (SPC) established by a Private Equity Fund (PEF) close to him. However, it was later revealed that HYBE was already in the process of going public that same year.
The police suspect that during this process, Chairman Bang entered into an agreement with the PEF to share 30% of the profits from the sale of the shares, without disclosing this information and subsequently profiting billions of won after the listing.
The SPC in question, established by executives of HYBE, with two out of three registered executives being from HYBE, has also come under scrutiny. Those closely associated with Chairman Bang, who received the shares, reportedly sold them immediately after the listing for substantial profits, according to the police.
The police applied for a search warrant on the 17th and received approval from the Seoul Southern District Court on the 23rd. Previous applications for warrants in April and May were rejected by the prosecution due to insufficient grounds. However, this time, the prosecution filed for the warrant with supplemented materials, and the court accepted it.
Following the complaint by the Securities and Futures Commission, the Seoul Southern District Prosecutors' Office has directed the Financial Supervisory Service's Special Judicial Police to lead the investigation. The police are currently coordinating with ongoing investigations.
(SBS Entertainment News | Kang Kyung-youn)