Fiscal reports revealed Hook Entertainment borrowed 4.7 billion KRW (about $3.5 million USD) from its artist singer/actor Lee Seung Gi for 7 years without paying any interest.
According to an exclusive media report on November 24th, fiscal reports of the company revealed Hook Entertainment borrowed 4.7 billion KRW from Lee Seung Gi with no interest for the purpose of management and operation costs in 2013. The entertainment company repaid the borrowed money in a lump sum after 7 years in 2020. But it is extremely unusual for an entertainment label to borrow cash from its artist.
An industry insider commented, "It's possible that the label used the celebrity's name to fund the money or the celebrity could have lent to the label on special terms." Another industry insider commented, "There are tax benefits when you buy real estate through a corporation but there needs to be further investigation on cash flows and tax filings."
Previously, media outlet Dispatch exposed Hook Entertainment for withholding Lee Seung Gi's music earnings from his entire career as a singer. During his 18 years long career as a singer, Lee Seung Gi released a total of 137 songs and 27 albums but he did not get any proceeds from the profits of selling his music. The CEO then released a statement saying the company is looking into the matter, however, a voice recording of the CEO's verbal abuse was revealed on November 23rd. Following on November 24th, Lee Seung Gi's legal representative released a statement of response.
Stay tuned for updates.