Police raid HYBE over Bang Si-hyuk fraud claims

Police have opened a criminal investigation into HYBE Chairman Bang Si-hyuk, who is accused of illegally profiting 190 billion won (about $137 million) through fraudulent stock transactions.

On Wednesday morning, the Seoul Metropolitan Police Agency’s Financial Crimes Investigation Unit raided HYBE’s headquarters in Yongsan District, central Seoul. The action follows an earlier search of the Korea Exchange in Yeongdeungpo District on June 30, where investigators obtained documents related to HYBE’s initial public offering review. Authorities are now intensifying their investigation.

Bang is suspected of deceiving early investors before HYBE’s 2020 IPO by falsely assuring them there were no plans for a public offering. Authorities say he persuaded investors to sell their shares, then proceeded with the IPO shortly after, reportedly earning 120 billion won for himself while HYBE executives collectively gained 190 billion won.

He is also accused of hiding a separate deal with a private equity fund. Under the agreement, he reportedly received about 400 billion won by agreeing to share 30 percent of the capital gains from stock sales but failed to disclose the contract in mandatory securities filings.

The investigation is being carried out jointly by the Financial Supervisory Service’s special judicial police, operating under both police and prosecutorial supervision. Earlier this month, the Financial Services Commission’s Securities and Futures Commission filed a criminal complaint against Bang and three former HYBE executives, sparking a dispute over which agency should lead the probe.

Police first opened their investigation in December 2023 but had two search warrant requests denied by the Seoul Southern District Prosecutors’ Office, which cited the ongoing Financial Supervisory Service probe. A warrant was granted on the third attempt, paving the way for last month’s raid on the Korea Exchange.

On July 21, the Seoul Southern District Prosecutors’ Office said it would ensure a smooth investigation, acknowledging that the Seoul Metropolitan Police Agency has been handling parts of the case.


이수연 기자 lotus@donga.com