South Korean police raided Korea Exchange offices last week (June 30) as part of an expanding investigation into alleged securities violations related to HYBE\u2019s 2020 IPO.<\/p>\n
Citing Korean police, Korea JoongAng Daily <\/i>reported<\/a> on Thursday (July 3) that the raid targeted the exchange\u2019s Yeouido office in Seoul, where investigators secured data related to the listing review process for the K-pop giant.<\/p>\n Police told the news outlet that they were collecting evidence for their probe into potential capital markets law violations by HYBE<\/strong> Chairman Bang<\/strong> Si-hyuk<\/strong>.<\/p>\n In late May, it was reported<\/a> that the South Korean financial watchdog, the Financial Supervisory Service (<\/strong>FSS), intensified its probe into Chairman Bang regarding alleged arrangements with specific investors and private equity funds prior to the company’s 2020 IPO.<\/p>\n While this story was initially covered at the close of 2024, it gained renewed attention more than a month ago when the Korea Economic Daily <\/i>published additional details<\/a>.<\/p>\n The publication said the FSS was conducting \u201ca fast-tracked investigation into [Chairman] Bang\u2019s transactions with the PEFs and plans to refer the case to prosecutors for potential criminal prosecution.\u201d<\/p>\n HYBE, formerly Big Hit Entertainment<\/strong>, went public on the Korea<\/strong> Exchange<\/strong> in October 2020 after raising<\/a> 962.6 billion South Korean won<\/strong> (approx. $706 million). At the time, MBW <\/i>noted<\/a> that the 36.6%<\/strong> stake held by Bang was worth 3.14 trillion won<\/strong> (approx. $2.3bn), making him the sixth richest person in Korea, according to the Korea Herald.<\/i><\/i><\/a><\/p>\n According to the allegations, Chairman Bang diverted potential investors away from HYBE’s planned public offering in 2019, instead directing them toward a private equity fund controlled by an associate, JoongAng <\/i>reported<\/a>.<\/p>\n Investigators reportedly claim Chairman Bang received 400 billion won<\/strong> (approx. $293 million) or 30%<\/strong> of the private equity fund’s investment returns after HYBE completed its listing in October 2020. Authorities reportedly allege this payment was not disclosed in the company’s required securities filings, according to the news outlet.<\/p>\n The latest development follows an earlier raid<\/a> carried out by authorities in South Korea at HYBE\u2019s headquarters as part of a separate investigation into alleged insider trading by a former executive.<\/p>\n