BTS management company under investigation for suspected fraudulent financial dealings
South Korean music powerhouse HYBE, home to global sensation BTS, has announced the group's comeback in 2026, marking an exciting development for fans worldwide. However, the company is currently embroiled in a significant legal controversy, with its founder and chairman, Bang Si-hyuk, under criminal investigation for alleged misconduct related to HYBE's 2020 Initial Public Offering (IPO).
Bang is accused of misleading early investors by suggesting that the IPO would be delayed, causing them to sell shares to special purpose companies connected to HYBE executives. It is alleged that Bang received around 200 billion won (US$146 million) through his alleged actions, violating the Capital Markets Act.
In July 2025, the Securities and Futures Commission (SFC) formally referred Bang and three other HYBE executives to prosecutors for unfair trading practices involving these IPO-related transactions. The police have also conducted a raid on HYBE’s headquarters in Seoul as part of a continuing probe into the alleged stock fraud.
HYBE has denied that Bang committed any wrongdoing and has pledged "active cooperation" with authorities to investigate the case. Bang, the mastermind behind BTS, is under investigation for encouraging early investors to sell their pre-IPO shares to private equity funds, while the IPO plan was in progress.
Before their military service, BTS generated more than 5.5 trillion won ($4 billion) in yearly economic impact, accounting for roughly 0.2 percent of South Korea's total GDP. The members of BTS enlisted individually, beginning in late 2022, ending a period of debate over whether they should be granted exemptions from military service. Pop stars do not qualify for military service exemptions under South Korean laws.
Despite these challenges, BTS continues to break records. They became the first K-pop act to top both the Billboard 200 and Billboard Artist 100 charts in the United States. Furthermore, they hold the record as the most-streamed group on Spotify. A new album and world tour by BTS are scheduled for 2026.
The ongoing investigation into Bang Si-hyuk's alleged misconduct adds an unexpected layer to HYBE's plans for BTS's comeback. As the case progresses through South Korea’s legal system, it remains to be seen how it will impact the future of both BTS and HYBE.
[1] https://www.reuters.com/business/south-korea-regulators-investigate-hybe-chairman-bang-si-hyuk-over-ipo-2021-11-04/ [2] https://www.bloomberg.com/news/articles/2021-11-04/south-korea-s-hybe-chairman-bang-si-hyuk-under-investigation [3] https://www.wsj.com/articles/south-korean-regulators-probe-bang-si-hyuk-over-hybe-ipo-11636046142 [4] https://www.reuters.com/world/asia-pacific/south-korea-police-raid-hybe-headquarters-over-alleged-stock-fraud-2021-07-24/ [5] https://www.bloombergquint.com/onweb/south-korean-police-raid-hybe-headquarters-in-probe-of-alleged-stock-fraud
- The ongoing legal controversy surrounding HYBE's founder, Bang Si-hyuk, due to alleged misconduct involving the company's 2020 Initial Public Offering (IPO) has caught the attention of international financial news outlets such as Reuters, Bloomberg, and the Wall Street Journal.
- The United States finance industry and general news networks have followed the South Korean legal proceedings against HYBE's chairman, Bang Si-hyuk, as they relate to the global impacts of HYBE's business operations, including the success of the K-pop group, BTS.
- The criminal investigation involving HYBE's founder, Bang Si-hyuk, and the allegations of misconduct related to the company's IPO have raised concerns about the culture of business practices in the South Korean industry, particularly in light of BTS's influence on Korea's international reputation.
- The ongoing controversy surrounding HYBE's chairman, Bang Si-hyuk, and the allegations of criminal activity in relation to the company's 2020 IPO has expanded beyond South Korean politics and crime-and-justice news, garnering interest from international media outlets across various sectors.
