It’s been a busy news week for HYBE, the entertainment giant behind K-pop stars like BTS and ENHYPEN.
The most recent news to hit headlines around the world is that the company’s offices in Seoul were raided by South Korean authorities on Thursday (May 29).
Citing “judicial sources”, the Korea Times reports that the company’s headquarters were searched as part of an investigation into alleged insider trading by a former executive.
That unnamed former exec allegedly made $176,500 by buying shares in rival K-pop company YG Entertainment’s subsidiary YG Plus, after learning that HYBE was planning to invest in the stock.
“We cooperated with the authorities in response to their request for information concerning the conduct of a former employee.”
HYBE spokesperson
A spokesperson for HYBE told MBW in a statement over email that the company is complying with the authorities in South Korea.
“We cooperated with the authorities in response to their request for information concerning the conduct of a former employee,” they said.
In a separate story this week, it was reported that the South Korean financial watchdog, the Financial Supervisory Service (FSS), is ramping up an investigation into HYBE’s Chairman Bang Si-hyuk over allegations surrounding agreements supposedly made with certain investors and private equity funds ahead of the company’s IPO in 2020.
This story was originally reported at the end of 2024, but resurfaced this week in the Korea Economic Daily with new alleged details. According to the report, the FSS is conducting “a fast-tracked investigation into Bang’s transactions with the PEFs and plans to refer the case to prosecutors for potential criminal prosecution”.
The Korea Economic Daily reports that the FSS is now investigating the case over “unfair trade practices,” having supposedly originally investigated it for “violations of securities report descriptions”.
The news outlet also reports that the Financial Crime Investigation Unit of the Seoul Metropolitan Police Agency is conducting a separate investigation into the case.
The Korea Economic Daily cited a HYBE spokesperson as saying: “All transactions were conducted within legal boundaries after going through a legal review.”
HYBE denied allegations of any wrongdoing when the initial story broke at the end of 2024.
“Our company provided the shareholder agreement in question to the IPO underwriters during the listing preparation process,” HYBE said at the time.
MBW reached out to HYBE for comment on these reports.
Elsewhere at HYBE this week, the company confirmed that it has opened an office in China, the world’s fifth-largest recorded music market.
Also, on May 28, HYBE division in America divested Big Machine Rock, the Nashville-based rock imprint of Big Machine Label Group, selling the label to Gebbia Media. (BMLG was acquired by Scooter Braun’s Ithaca Holdings in 2019. The entirety of Ithaca, including BMLG and Braun’s SB Projects, was then acquired by South Korea’s HYBE in 2021.)Music Business Worldwide
