Investigation into the Big 4 Entertainment Companies

The police embarked on a full-fledged investigation into structural irregularities of large entertainment planning companies.

The Criminal Investigation Department of Seoul District Public Prosecutor`s Office (Chief Public Prosecutor Kim Kyu-hyun) announced July 12 of having searched the offices of the four largest domestic entertainment planning companies.

The police banned more than 10 persons from leaving the country, including CEOs and heads of the four companies, and said the list of suspected persons is expected to grow.

The Public Prosecutor`s Office plans to delve into the appropriateness of capital, stocks and investments of the four biggest entertainment companies dubbed Big 4.

Currently, the prosecution is examining PC hard disks and accounting books of the suspected companies, focusing their efforts on unearthing their back-scratching relationship with producers of broadcasting companies.

After having tracked down bank accounts of the four companies, the prosecution has reportedly found a clue that leads to uncovering who of the TV producers and entertainment reporters had received bribes.

The prosecution also plans to conduct a thorough investigation into stocks and money lobbying practices that might have occurred when two of the four indicted companies were being listed on KOSDAQ.

Meanwhile, an arrest warrant has been issued for Hwang Yong-woo (43), a former MBC producer, indicted for having received 67 million won last year from the father of a new artist, last-named Kim, promising to include Kim in Music Camp.

People related to the entertainment industry say that such an investigation into the lobbying practices of entertainment companies that have been commonplace so far is the first of its kind.

Amidst that, concerns have been raised over a possibility that all kinds of irregularities might be uncovered through this investigation conducted for the first time after several of the largest entertainment companies were listed on the KOSDAQ marking the emergence of entertainment as an industry.

Some of the people engaged in the music business said that not only small planning companies but large companies managing the most popular artists as well have been constantly charging PR costs, which amount to 300 million won per CD.

Some of large entertainment companies` producers who are known for having received bribes have not appeared in their offices after the investigation was started.

Myoung-Gun Lee Seung-Heon Lee gun43@donga.com ddr@donga.com