HYBE chairman Bang Si-hyuk has been summoned for questioning by police for the second time in just one week over allegations linked to the company’s initial public offering process. The ongoing investigation has thrown a spotlight on the entertainment giant and stirred debate among fans, investors, and industry watchers.
The core of the case dates back to 2019, before HYBE went public. Authorities allege that Bang told early investors, including venture capital firms, that there were no plans for an IPO, while in fact the company was already preparing to list.
Based on that statement, some investors sold their shares to a special-purpose company (SPC) established by a private equity fund linked to HYBE executives. After HYBE’s IPO, the SPC sold its shares at a profit. Bang is accused of receiving roughly 30 percent of those gains.
The suspected unfair profit is estimated to be approximately 190 billion Korean won (around USD 135-140 million) by the police. Under South Korea’s Capital Markets Act, false statements to shareholders during processes like IPOs are illegal.
What Has Happened So Far
- On September 15, Bang was first called in for questioning by the Financial Crime Investigation Unit of the Seoul Metropolitan Police.
- On September 22, he appeared again, this time for over 12 hours of closed-door interrogation, starting in the morning and lasting until late evening.
- The questioning took place at the Mapo office region in western Seoul.
Bang has denied wrongdoing. His legal team asserts that all relevant laws and regulations were followed for HYBE’s IPO, and that the agreements with the SPC and private equity fund were disclosed appropriately.
Authorities have conducted related actions as part of the probe. Earlier this year, they searched the Korea Exchange for IPO screening documents, and HYBE’s headquarters were raided in July.
Why This Matters
This case is significant for several reasons:
- Investor trust is at the center. If early investors were misled, it could shake confidence in how IPOs are conducted in South Korea.
- Corporate governance is being scrutinized, especially in the entertainment industry, where big companies are closely associated with their founders. HYBE is known for managing major global acts like BTS, Seventeen, and NewJeans.
- Legal precedent could be set here. If Bang is found liable under the Capital Markets Act, penalties could be severe. Cases involving false statements or manipulation of pre-IPO deals do carry heavy charges under South Korean law.
What to Expect on the Continuing Investigation on HYBE and Bang Si-hyuk
- Whether there will be more rounds of questioning. The investigation is ongoing and could require additional sessions.
- What evidence will surface regarding internal communications or documents about IPO plans? These could confirm or refute whether HYBE had really decided to go public before publicly declaring otherwise.
- How HYBE responds. So far, the company denies wrongdoing and says it is cooperating. How forceful that cooperation is, and whether any internal audits or third-party reviews are done, could influence public opinion.
- Possible repercussions for HYBE’s reputation, investor relations, and maybe regulatory reforms in the IPO process, especially for high-profile entertainment corporations.
Closing Thoughts
From what is publicly known, this case highlights the tension between corporate transparency and strategic timing. It is not unusual for companies to plan IPOs well in advance while keeping details under wraps. But when statements to investors contradict internal plans, legal and ethical lines can blur.
If Bang and HYBE can show that all relevant disclosures were made, or that investors were not misled, the case may not amount to severe legal fallout. But the scale of the alleged profits and the severity of the charge make this one of the more serious financial controversies in K-entertainment in recent years.
Regardless of outcome, this investigation will likely serve as a reminder to companies in K-pop and elsewhere that investor relations and regulatory compliance must go hand in hand. In a global entertainment landscape, trust builds and breaks fast.
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