Police have refiled an arrest warrant for Bang Si-hyuk, chairman of HYBE, who is accused of deceiving investors into selling shares ahead of the company's IPO. This comes just six days after prosecutors rejected the initial warrant, citing insufficient justification for detention.
According to reports on May 7, the Seoul Metropolitan Police's Financial Crime Investigation Unit submitted the warrant application on April 30, targeting Bang for fraudulent trading under the Capital Markets Act.
The police initially filed the warrant on April 21, but the Southern District Prosecutors' Office returned it on April 24, requesting further investigation. Prosecutors stated they found a lack of compelling reasons for detention at that time. Following this, police reinforced their case by highlighting concerns about potential flight, evidence destruction, and recidivism risks.
Bang is accused of misleading existing investors and venture capitalists by claiming there were no plans for an IPO during the 2019 listing process, subsequently persuading them to transfer shares to a private equity fund he was connected to. Police suspect he received about 190 billion won from this arrangement, totaling illicit gains of approximately 260 billion won.
Current capital market laws prohibit obtaining financial benefits through false information or fraudulent schemes during investment transactions. If the illicit gains exceed 5 billion won, penalties can include life imprisonment or a prison term of five years or more.
The police began their investigation based on internal tips, conducting searches and summons since last year. They raided the Korea Exchange and HYBE in June and July 2022 and placed a travel ban on Bang upon his return from the U.S. in August. He was interrogated five times from September to November 2022.
Additionally, police have secured pre-indictment asset preservation measures on Bang's HYBE shares, valued at approximately 156.8 billion won. During the initial warrant application, police cited the severity of the case, noting that the amount involved exceeded 100 billion won, as well as evidence suggesting Bang replaced his mobile phone shortly before the investigation.
If prosecutors proceed with the refiled warrant, a pre-arrest hearing may be held in court.
* This article has been translated by AI.
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