On July 21, 2025, KBS reported that HYBE chairman Bang Si-hyuk is under investigation over suspected stock-related fraud tied to the company’s public listing. On July 17, Seoul’s financial crime unit requested a search warrant for Bang and HYBE’s headquarters in Yongsan-gu.Police suspect that in 2019, before HYBE went public, Bang misled early investors (mainly venture capital firms) by delaying IPO plans. During this time, shares were sold to a special company funded by private equity managed by HYBE executives.Authorities say HYBE was already preparing to go public when these deals happened. After listing, the special firm sold its shares and made a profit of over 100 billion won. Police believe Bang may have gained from this sale.Investigators have reviewed records from the Korea Exchange and the Financial Supervisory Service. They also questioned investors involved with the private equity fund. The probe is nearly complete. Once the court approves the search warrant, the case will likely be referred to prosecutors for further legal action.Separately, on July 16, the Securities and Futures Commission reported Bang Si-hyuk to prosecutors for suspected violations under the Capital Market Act involving fraudulent trading. The case may soon move to the next legal stage.HYBE Bang Si-hyuk's investor fraud case: First major financial investigation under Lee Jae-myung View this post on Instagram Instagram PostThis move marks the first big financial enforcement case involving a top business figure under President Lee Jae-myung’s administration. Bang Si-hyuk was reportedly offered a chance to respond directly but chose not to attend.On July 17, HYBE responded, asserting that it intends to collaborate and fully explain any mistrust. The firm noted that Bang had already explained his stance during earlier reviews and denied personal benefit from the public offering. Despite that, the company said it respects the decision and will aim to rebuild market confidence.“It is unfortunate that the financial regulators did not accept the major shareholder’s explanation during the Financial Supervisory Service’s investigation, in which he made clear he did not pursue personal gains based on the company’s IPO," HYBE said in a statement to the Korea Herald.The South Korean conglomerate added:“Nevertheless, we respect the decision and will do our utmost in the upcoming investigation to actively address the allegations and recover the trust of the market and our stakeholders."As a result of this case, the Korea Exchange updated its IPO screening process at the end of last year. Now, there are tighter checks on private deals between company insiders and stronger rules to protect investors.In other news, Bang Si-hyuk is said to have earned over 1 trillion KRW through his private equity fund following HYBE’s stock market debut, even as he faces accusations of IPO-related fraud.