The warrant request follows a grueling 16-month investigation into alleged Capital Markets Act violations. According to the Financial Crimes Investigation Unit, Bang is suspected of orchestrating "fraudulent unfair trading" leading up to HYBE’s 2020 initial public offering.
The Allegations
Investigators allege that in 2019, while HYBE still operated as Big Hit Entertainment, Bang told early venture capital investors that there were "no plans" for a public listing. This reportedly induced shareholders to sell their stakes at a lower valuation to a private equity fund linked to Bang’s associates.
Police believe a "backdoor" profit-sharing agreement guaranteed Bang 30% of the capital gains once the company listed, allowing him to pocket roughly $129 million (190 billion won) in illicit profits. Under South Korean law, fraudulent gains exceeding 5 billion won can carry a maximum sentence of life imprisonment.
Management and Market Impact
Bang’s legal team expressed "deep regret" over the warrant request, maintaining that all transactions were lawful and conducted at the request of the investors themselves.
The timing of the crisis is particularly precarious. HYBE shares dropped nearly 3% following the news, which arrives as BTS prepares for a highly anticipated 2026 global tour. Adding a layer of diplomatic complexity, the U.S. Embassy in Seoul recently requested a temporary lift of Bang’s travel ban—in place since August 2025—to allow him to coordinate tour logistics in the United States.
As prosecutors review the warrant, the case stands as a landmark test for corporate governance and transparency in the rapidly expanding global K-pop sector.
"The article details a significant legal challenge for HYBE Chairman Bang Si-hyuk. South Korean authorities have requested an arrest warrant for the 53-year-old mogul, alleging he orchestrated a $128 million (190 billion won) fraud scheme during the company's 2019 IPO. Investigators claim Bang misled early investors into selling their shares cheaply to a fund he controlled before taking the company public. Bang, who has been under a travel ban since August 2025 and questioned five times, denies all charges. This legal battle coincides with internal corporate feuds at HYBE and has already impacted the company's stock value."
Source:(1)