Bang Si-hyuk, president of K-pop entertainment powerhouse HYBE, underwent his third police interrogation on Nov. 5 as authorities continue to investigate allegations that he was involved in fraudulent transactions related to the company’s initial public offering.
The Financial Crimes Investigation Unit of the Seoul Metropolitan Police Agency summoned the executive to provide further testimony regarding violations of the Capital Markets Law.​
Investigators are looking into the allegations Bang misled investors in 2019 by falsely claiming that HYBE had no intention of going public, then had them sell their shares to a special purpose vehicle set up by a private equity fund with which it was affiliated. Police examined his statements regarding intent to deceive, the movement of funds through the transaction and the structure of his deal with the private equity vehicle.​
According to authorities, while Bang was assuring venture capital firms and other shareholders that no public listing was planned, HYBE was simultaneously going through preliminary IPO procedures. The company had started requiring a designated auditor, a requirement for going public, during the period in question. When HYBE subsequently proceeded with its public offering in 2020, the special purpose vehicle sold its shares at substantial profits. Bang is suspected of having received about 190 billion won (about $131 million) from the transaction, reportedly through a pre-arranged agreement that entitled him to 30% of the capital gains.
This marks the third known case of Bang interrogationfollowing two public calls in September. His first interrogation lasted about 13 hours, after which he left the police facility, refusing to comment to journalists. From the start of the investigation to the end of 2023, authorities conducted searches at the Korea Stock Exchange in June and at HYBE’s headquarters in July to collect relevant documentation.
The Seoul Metropolitan Police Agency previously announced it was conducting a legal review regarding potential arrest warrant requests. Bang was placed on a travel ban due to the allegations. Meanwhile, HYBE has maintained through official statements that all procedures during the listing process were in compliance with the laws and regulations applicable at that time and that the company will fully cooperate with the investigation.​
The case represents accentuated execution action under current leadership priorities to combat securities violations that affect ordinary investors. Financial authorities have determined that the situation merits serious legal consideration, with experts pointing out that violations of Article 178 of the Capital Markets Law carry minimum penalties of five years’ imprisonment or potential life sentences for cases involving ill-gotten gains exceeding 5 billion won.
