FSS to Refer HYBE Chairman Bang Si-hyuk to Prosecutors for Alleged ‘Fraudulent Unfair Trading’ During IPO
On May 28, HYBE’s chairman Bang Si-hyuk is reportedly on the Financial Supervisory Service’s (FSS) radar for possibly breaking the Capital Markets Act. Word is, he might’ve misled some big-time investors right before the company’s IPO and personally made a fortune from it.
So, here’s what went down. Back in 2019, when HYBE (called Big Hit Entertainment back then) was getting things ready behind the scenes for a public listing, Bang apparently told existing investors like VCs and other institutional players that there were “no IPO plans.” Trusting him, those folks sold off their shares.
Turns out, that info may not have been true at all. The FSS has reportedly found that Bang had set up a private equity fund (PEF) with someone close to him, and used it to buy up those shares. Later, he supposedly made a deal with that fund to split 30% of the profits. And yeah, that little arrangement wasn’t mentioned in the mandatory securities registration statement.
Meanwhile, industry watchers say HYBE was already deep into IPO prep at the time—like applying for a designated auditor—so there’s speculation that Bang kept the IPO plans hush-hush on purpose. That’s where the whole “fraudulent unfair trading” talk is coming from.
After the IPO went through, Bang reportedly cashed in big—about 400 billion won, or roughly $290 million. Because of the size of the profits involved, this case is being fast-tracked. Under the Capital Markets Act, if someone makes more than 5 billion won (around $3 million) through this kind of violation, they could be looking at at least five years behind bars—or even a life sentence.
The FSS isn’t giving much away officially. About this case, they simply said, “Nothing has been confirmed,” and “We cannot confirm whether a specific company is under investigation or disclose details of any investigation.”
Now, everyone’s waiting to see if Bang will be referred to prosecutors and what happens next. Industry insiders are saying the chances that this could be ruled fraudulent unfair trading are pretty high.
