HYBE is currently under investigation by South Korea’s tax authorities.
On July 29, the Seoul Regional Tax Office’s 4th Bureau dispatched agents to HYBE’s headquarters in Yongsan, Seoul, to collect documents necessary for a tax investigation.
The 4th Bureau is a specialized division typically deployed when concrete suspicions have been identified. Known for conducting deep, targeted audits, it has earned the nickname “Grim Reaper of the Business World,” making this investigation particularly significant.
This is HYBE’s first tax investigation in three years, the last one occurring in June 2022. At that time, it was the 1st Bureau of the Seoul Tax Office that carried out a routine audit, resulting in a tax penalty of several billion won (equivalent to several million euros).
Additionally, on July 24, the police raided HYBE’s headquarters. HYBE’s chairman, Bang Si Hyuk, is suspected of having misled early investors by claiming that there were no plans for an IPO (Initial Public Offering), persuading them to sell their shares to a private equity fund connected to him. HYBE later went public, and Bang reportedly received 30% of the resale profits, earning an unjust gain estimated at 190 billion won (around 130 million euros), according to financial authorities.
Prior to this, on July 16, the Securities and Futures Commission had already filed a formal complaint with the prosecution against Bang Si Hyuk and former HYBE executives.
In response, HYBE stated:
“The major shareholder appeared before the Financial Supervisory Service (FSS) to clearly explain that there was no personal financial motive behind the IPO. It’s unfortunate that this explanation was not accepted. We respect the decision of the financial authorities and will do our utmost to clarify all suspicions in the upcoming investigation, in order to regain the trust of the market and our stakeholders.”
Following that, HYBE’s Chief Legal Officer, Jung Jin Soo, issued an internal email stating:
“The company is fully cooperating with the authorities in verifying the facts. We will make a thorough effort to demonstrate that all actions were conducted in full compliance with applicable laws and regulations.”
This investigation presents another serious challenge for the agency, one in which it must prove the integrity and legality of its business practices.
Journalist: Shawn
Translator: Shawn
Source: Korean Medias
