HYBE founder and chairman Bang Si Hyuk was questioned by police on September 15th as a suspect in an unfair share trading investigation. Authorities allege that Bang informed investors there were no plans for an IPO in early 2019, while the company was reportedly preparing for a public listing that enabled a private equity fund, established by Bang and his close associates, to reap significant profits.
Former ADOR CEO Min Hee Jin has also come forward, claiming that Bang personally told her in early 2019 that HYBE had “no plans for an IPO.” In evidence submitted in a separate lawsuit, Min alleged that Bang encouraged her to take a cash signing bonus instead of stock options, saying that “cash is better.” She joined the company, then Big Hit Music, as Chief Brand Officer later that year, saying she trusted his word.
Investigators are examining a timeline in which Bang’s close associates established a private equity fund just three months after his alleged denial to Min. That fund went on to acquire a large stake in HYBE, then sold its shares immediately after the company went public in October 2020, reaping nearly ten times its initial investment. The stock price later plunged by almost 60%, leaving small investors with heavy losses.
Reports allege that a significant portion of the fund’s profits—around 400 billion won ($295 million)—was funneled back to Bang through an undisclosed “earn-out contract.”
Police suspect Bang concealed the company’s listing plans all along. Evidence shows HYBE began its formal IPO process in late 2019. According to one accounting expert, the extensive preparation required for a listing “makes it reasonable to assume that IPO plans were in place as early as 2018.”
Police and financial regulators have already raided both HYBE headquarters and the Korea Exchange as part of the ongoing investigation.
>> Bang Si Hyuk Appears for Police Questioning in Massive HYBE Stock Fraud Case
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