HYBE chairman case reaches prosecutors: What's next for him?

By Pyo Kyung-min

• Published Sep 7, 2026 12:23 PM KST
• Updated Sep 7, 2026 5:35 PM KST

Key question will be whether his conduct violated public interest

The police file on HYBE Chairman Bang Si-hyuk arrived at the Seoul Southern District Prosecutors' Office last week with a precise number attached: 263.1 billion won ($190 million) in what investigators called improper gains.

The question that will decide Bang's fate is one that police and prosecutors have spent almost two years failing to settle between themselves: what crime, if any, the conduct amounts to.

On Thursday, the Seoul Metropolitan Police Agency's financial crime investigation unit referred Bang and four others to prosecutors without detention on suspicion of fraudulent unfair trading under the Capital Markets Act, closing an investigation that went on for 21 months.

Prosecutors will now review the record before deciding whether to indict, order further investigation or drop the financial crime charge, and lawyers who work these cases say all three remain possible.

What police say happened

Investigators allege that in 2019, while the company, then known as Big Hit Entertainment, was already moving through preliminary listing procedures, Bang and others told existing shareholders, including venture capital backers, that there were no plans for an initial public offering. Those shareholders sold their stakes to a special purpose company created by private equity funds run by people close to Bang, while investors in the funds themselves were told the listing was coming.

As Big Hit Entertainment went public in October 2020, the funds sold the shares in two rounds, and the participants, according to the police, earned 263.1 billion won.

Of that amount, Bang is reported to have taken roughly 150 billion won under an undisclosed side agreement entitling him to 30 percent of the proceeds. A court granted the police request to preserve assets equivalent to the full amount ahead of any prosecution.

Also referred were HYBE Chief Executive Lee Jae-sang, former HYBE Chief Financial Officer Kwon Yong-sang, Easton Equity Partners Chief Executive Yang Jun-seok and NewMain Equity Chief Executive Kim Chang-hee.

Police opened a preliminary inquiry in December 2024 and raided HYBE's headquarters the following year. In August 2025, Bang was barred from leaving the country and was questioned by police five times between September and November the same year.

They sought his arrest twice, on April 21 and 30, and prosecutors rejected both requests, first citing insufficient grounds for detention and then saying the supplementary investigation they had ordered was never carried out.

Unresolved legal question

Police claimed throughout that the conduct damaged the fairness and integrity of the capital market, not serving public interest that the fraudulent trading provision is designed to protect.

On the other hand, prosecutors leaned toward treating it as harm to specific individual investors, and suggested police consider ordinary fraud instead.

"Under general criminal law, individual and public legal interests are separated by offense, but the Capital Markets Act does not draw that distinction explicitly, so disagreement can arise in interpretation," Seog Sang-yub, an attorney at Law Firm Illo, told a local media outlet.

Choi June-sun, professor emeritus at Sungkyunkwan University Law School, said the evidentiary burden is the practical challenge.

"To secure a conviction for fraudulent trading, prosecutors would have to establish clear causation, and where a public interest is at stake is difficult to prove."

None of that means the case would end quietly. Attorney Chong Kyong-sok of LIWU Law Group told The Korea Times that a decision not to prosecute would be its own kind of problem.

"Police applied for an arrest warrant twice. It would be a heavy burden for prosecutors to conclude with no charges, and the direction of the case is unlikely to be that," Chong said.

"Ultimately this is for a court to decide, and the more genuinely contested the question of whether an offense was committed, the more investigators tend to bring charges rather than resolve it themselves."

Bang and HYBE have denied wrongdoing throughout, maintaining that the listing complied with the relevant laws and regulations and that investors were not deceived.

Bang's legal team said it had consistently made its case on the basis of objective materials and evidence, and that it expects the allegations to be resolved transparently through the proceedings ahead.