Min Hee-jin alleges Bang Si-hyuk had "no plans to go public" in the 2019 IPO deception case, amidst ongoing police investigation

On September 15, HYBE chairman Bang Si-hyuk appeared before the Seoul Metropolitan Police Agency’s Financial Crime Investigation Division. He was summoned as a suspect under the Capital Markets Act for allegations of unfair trading linked to the company’s IPO.

Authorities have accused him of misleading investors in 2019 by claiming Big Hit Music, HYBE’s predecessor, had no plans to go public. It has since been reported that Bang made the same statement to Min Hee-jin, the former CEO of ADOR, during recruitment talks in January 2019.

According to a recent report by Hankyoreh, Min Hee-jin told the publication that Bang Si-hyuk had told her cash was preferable to stocks. He reportedly also suggested a signing bonus instead of stock options. As per the publication, Min Hee-jin allegedly said,

"Chairman Bang, whom I met in person (for a salary contract) in January 2019, said, ‘We have no plans to go public,’ and suggested, ‘Cash is better than stocks (as an incentive). Let’s replace it with a signing bonus."

She later joined Big Hit Music as Chief Brand Officer in July of that year. Min Hee-jin submitted this statement as evidence in her ongoing lawsuit against HYBE regarding stock purchase options. The timeline is now under review.

Just three months after Bang Si-hyuk’s alleged comment to Min Hee-jin, a private equity fund believed to be linked to his close associates was created. By June 2019, the fund had already started buying shares from early investors, reportedly at discounted rates due to claims that no IPO was planned.

These shares were later sold after HYBE’s IPO in October 2020, with reports estimating profits of nearly ten times the initial investment. About 30% of those profits, around 400 billion KRW, allegedly went to Bang Si-hyuk.

According to the same Hankyoreh report, contrary to his earlier claims, documents reportedly show that HYBE had applied to appoint an IPO-designated auditor by late 2019. That is said to be a mandatory step in the process. Such filings indicate preparations were underway as early as 2018. However, HYBE has maintained that no official IPO discussions took place until late 2019.

Bang Si-hyuk questioned as investigation expands

Bang Si-hyuk’s appearance marked the first time he has faced police questioning in person. Dressed formally, he told reporters before entering the police station that he would fully cooperate with the investigation and apologized for the concern caused.

The investigation has grown wider in recent months. In June, police raided the Korea Exchange to gather documents related to HYBE’s listing. In July, HYBE’s headquarters in Yongsan were also searched. Additionally, the Financial Services Commission’s Securities and Futures Commission filed a criminal complaint against Bang Si-hyuk, accusing him of unfair trading.

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The case has since been referred to the Financial Supervisory Service’s special judicial police for further inquiry.

According to The Korea Times, authorities alleged that Bang Si-hyuk gained significant benefits through an earn-out agreement linked to the fund’s share sales, a deal that was not disclosed to the Korea Exchange at the time of listing.

The publication also suggested that Bang Si-hyuk may have pocketed around 190 billion KRW (140 million USD) in illegal profits.According to The Korea Times, HYBE representatives stated that the conversation between Si-hyuk and Min Hee-jin was personal and not verifiable at the company level. They said,

"It may take some time, but we will fully explain that the listing at the time was carried out in compliance with laws and regulations."

Bang’s side has continued to insist that the IPO process was carried out legally and in line with regulations.

Police investigations are ongoing as prosecutors review the extent of potential unfair practices tied to HYBE’s stock listing.

About the author

Mantasha is a pop culture writer at Sportskeeda who covers K-pop and K-drama. She has recently completed her Masters in English and has a rich 3-year writing experience where she crafted engaging content for top companies such as Unacademy, Apollo Hospitals, Adani Airports, and the Economic Times. Her experience has helped her create a strong foundation that complements her passion for creating the best content related to K-pop, K-dramas and Korean movies.

Mantasha's interest in pop culture took root when her cousin introduced her to classic Hollywood and Bollywood tunes and the rest, as they say, is history. Mantasha’s connection with K-pop supergroup BTS is a special one as their song lyrics, hard work, and dedication resonate with her like no other group does.

Maintaining accuracy, relevance, and ethics in her reporting is extremely essential for Mantasha. She prioritizes thorough research, delving deep beyond just superficial sources, to ensure comprehensive and trustworthy information.

When not writing, Mantasha enjoys journaling and doodling, watching K-dramas and listening to songs.

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Edited by Shreya Das