Bang Si-hyuk, Chairman of HYBE, Appears Before Police Over 'Suspicion of Fraudulent Transactions'... Apologizes for Causing Concern

Chairman Bang Si-hyuk of HYBE appeared before the police on charges of violating the Capital Markets Act. The Financial Crime Investigation Unit of the Seoul Metropolitan Police Agency summoned Chairman Bang as a suspect on the morning of the 15th for questioning.

Arriving at the Financial Crime Investigation Unit of the Seoul Metropolitan Police Agency in Mapo-gu, Seoul at around 9:55 AM, Chairman Bang stood at the photo line in a black suit. Looking somewhat gaunt, Chairman Bang briefly stated, "I apologize for causing concern due to my actions. I will sincerely cooperate with the investigation," before heading to the interrogation room.

Chairman Bang is accused of inducing investors to sell shares in a private equity fund related to him while claiming there were no plans for an Initial Public Offering (IPO) prior to HYBE's listing in 2019. The police suspect that Chairman Bang, while actually proceeding with the listing process for HYBE, contracted to receive a portion of the profits from the sale of shares from the private equity fund, amounting to unjust profits of approximately 190 billion to 200 billion won.

Specifically, Chairman Bang is suspected of having contracted to share 30% of the sale profits with a private equity fund (PEF) established by an acquaintance and inducing existing investors to sell their shares in HYBE to that PEF, thereby receiving the profits from the settlement. This could constitute a violation of the prohibition against fraudulent trading under the Capital Markets Act.

Previously, the Financial Supervisory Service conducted an investigation into these allegations and reported them to the prosecution, and the police have been conducting investigations after receiving related materials from the Financial Supervisory Service. At the end of June, Chairman Bang also appeared before the Financial Supervisory Service for questioning.

Through this investigation, the police plan to focus on whether Chairman Bang actually deceived investors to gain unjust profits and whether there are violations of the Capital Markets Act. If the allegations against Chairman Bang are proven, significant damage to HYBE's corporate image is expected.

Meanwhile, this incident has once again raised controversy over unfair trading allegations during HYBE's Initial Public Offering (IPO) process, and it is anticipated that the repercussions will grow depending on the results of the investigation.