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Investigation launched at BTS management headquarters HYBE, suspecting fraudulent trading activities

Police in South Korea have conducted a raid on BTS agency HYBE, amidst allegations of securities fraud involving the company's founder, Bang Si-hyuk, and the 2020 IPO.

BTS parent company's headquarters, HYBE, undergoes seizure as part of an investigation into...
BTS parent company's headquarters, HYBE, undergoes seizure as part of an investigation into questionable stock dealings.

Investigation launched at BTS management headquarters HYBE, suspecting fraudulent trading activities

South Korea's entertainment conglomerate, HYBE, and its founder Bang Si-hyuk, along with several executives, are under investigation for alleged securities fraud involving deceptive share transactions surrounding HYBE's 2020 Initial Public Offering (IPO).

Authorities claim that Bang misled early investors in 2019 into selling shares at a discount to an investment firm secretly linked to him. These shares were later sold for a profit once HYBE went public, allegedly generating illicit profits estimated to range from about 200 billion won ($146 million) to nearly 400 billion won ($290 million).

The investigation intensified after a police raid on HYBE's Seoul headquarters in July 2025, triggered by a complaint from the Securities and Futures Commission. Bang has issued a formal apology to employees and pledged full cooperation with authorities, planning to return to South Korea to clarify the situation and address allegations transparently.

The controversy raises serious concerns about HYBE's corporate governance and risks damaging its reputation extensively. It also threatens investor confidence and could complicate the company’s future projects, including the highly anticipated BTS comeback planned for 2026. Industry observers warn the controversy may impact HYBE’s global standing and shake trust in South Korea’s entertainment industry governance.

In response, HYBE has denied any illegal activities, affirmed transparency, and committed to cooperating with the ongoing investigations to resolve misunderstandings and protect their artists and stakeholders.

Meanwhile, Scooter Braun, the former CEO of HYBE America, has stepped down and will now take on an advisory role. The exact reasons for his departure are not specified in the article.

The investigation is being conducted by the Seoul Metropolitan Police Agency's Financial Crime Investigation Unit. However, the article does not provide any updates on the progress of the investigation into HYBE.

If proven right, these accusations could lead to significant damage to HYBE's reputation. The timing of the controversy and investigation could also impact investors' confidence, potentially complicating BTS's future endeavors, including their planned comeback in 2026.

The scandal also raises questions about South Korea's governance in the entertainment sector, with concerns that it may impact HYBE’s global standing and the trust in South Korea’s entertainment industry governance.

HYBE has promised to cooperate with authorities and ensure transparency to clear any misunderstandings. The company has pledged to uphold its commitment to its artists and stakeholders, aiming to navigate this challenging period with integrity and honesty.

  1. The investigation into HYBE's alleged securities fraud has intensified concerns about the company's corporate governance, potentially damaging its reputation in the general-news sector and causing complications for future business projects, such as the upcoming BTS comeback in music.
  2. The controversy surrounding HYBE's alleged deceptive share transactions could lead to significant financial losses, estimated to range from 200 billion won to nearly 400 billion won, and may impact the trust in South Korea's entertainment industry governance, especially in the crime-and-justice category.
  3. The scandal involving HYBE's founder Bang Si-hyuk could affect the entire entertainment culture in South Korea, as industry observers express concerns about the future of the industry's governance, particularly in light of the ongoing investigation by the Seoul Metropolitan Police Agency's Financial Crime Investigation Unit.

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