The police have reportedly requested a search and seizure warrant for HYBE chairman Bang Si Hyuk, who is under suspicion of having earned over 100 billion KRW (~72.3 million USD) in illicit profits by allegedly deceiving investors during HYBE's listing process.
On July 17, the Financial Crime Investigation Division of the Seoul Metropolitan Police Agency submitted a warrant request targeting Chairman Bang and HYBE's headquarters in Yongsan, Seoul.
Bang Si Hyuk is accused of misleading existing investors, including venture capital firms, in 2019, before HYBE's IPO, by falsely suggesting that the company's listing would be delayed. He then allegedly facilitated the sale of their shares to a special purpose company (SPC) established by a private equity fund funded by HYBE executives.
According to the police, the investors, believing in Bang Si Hyuk's claims, sold their shares to the private fund. However, it is believed HYBE was already moving forward with its IPO process at the time.
After HYBE went public, the SPC sold off its shares, and the police suspect Bang Si Hyuk personally profited by over 100 billion KRW through this sale.
The Financial Crime Investigation Division has reportedly completed its analysis of fund flows and related materials after receiving documents from the Korea Exchange and the Financial Supervisory Service.
The investigation is said to be in its final stages, with authorities also summoning the private fund investors for questioning.
Meanwhile, on July 16, the Securities and Futures Commission (SFC) under the Financial Services Commission referred Bang Si Hyuk to the prosecution for violating the Capital Markets Act's prohibition on unfair trading practices.
Regarding this referral, the Seoul Southern District Prosecutors' Office stated this afternoon that the case has been assigned to the Capital Markets Special Judicial Police under the Financial Supervisory Service for investigation.
Concerning the police warrant request, the Seoul Metropolitan Police Agency also commented that it "will ensure the ongoing investigation into HYBE proceeds smoothly."
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