Bang Si-hyuk, the founder and chairman of HYBE and the executive behind the entertainment company associated with global K-pop group BTS, has been referred to prosecutors in South Korea over allegations of fraudulent unfair trading connected to HYBE’s 2020 initial public offering.

The Seoul Metropolitan Police Agency referred Bang to the Seoul Southern District Prosecutors’ Office on Thursday, September 3, 2026, without detention. Four other individuals, including HYBE executives and private equity officials, were also referred in connection with the case. Police allege violations of South Korea’s Capital Markets Act.

The case centers on events leading up to HYBE’s stock market debut. According to investigators, Bang allegedly told existing shareholders in 2019 that there were no plans for the company to conduct an IPO, even as preparations for a public listing were reportedly underway.

Police allege that some of those shareholders subsequently sold their stakes to a private equity fund connected to Bang. Investigators further allege that the fund had information about the planned listing and later benefited when HYBE shares were sold following the company’s public debut.

HYBE ultimately went public in October 2020, marking a major milestone for the entertainment company and its founder. The listing came as HYBE, then known for managing BTS and other major artists, continued expanding its influence within the global music industry.

Police estimate that approximately 263.1 billion won, or roughly $193 million, in illicit gains were generated through the alleged transactions. Authorities have obtained a court order preserving the full amount for potential forfeiture while the legal process continues.

The investigation has been lengthy. Police began their preliminary inquiry in December 2024 and subsequently conducted searches, reviewed financial and corporate records, and questioned Bang during the investigation. The case eventually progressed to a formal investigation before police concluded their work and forwarded the findings to prosecutors.

Bang has not been detained. Police previously sought arrest warrants on two occasions, but prosecutors rejected those requests. The latest referral was therefore made without detention, leaving prosecutors to review the evidence and determine whether formal charges should be pursued.

The allegations are serious because South Korea’s capital-markets laws impose significant penalties for certain forms of fraudulent unfair trading. According to Yonhap, individuals convicted of obtaining at least 5 billion won in profits through deception involving financial investment products can face a minimum prison term of five years or life imprisonment, depending on the circumstances.

Bang’s legal representatives have denied wrongdoing and have indicated that the allegations can be addressed through the legal process. The referral to prosecutors does not itself constitute a conviction, and the allegations remain subject to prosecutorial review and any subsequent court proceedings.

The case has attracted significant attention because of Bang’s position in South Korea’s entertainment industry and HYBE’s importance in the global K-pop business. As the company’s founder, he played a central role in transforming the agency into one of the country’s most prominent entertainment companies.

For HYBE and its shareholders, the investigation represents a major legal development surrounding the company’s historic public listing. Prosecutors will now examine the police investigation and determine whether the evidence supports an indictment.

The referral marks the latest stage in a case that has taken nearly two years to develop. While police have completed their investigation and outlined allegations involving Bang and four other individuals, the final outcome will depend on prosecutorial decisions and, if charges are filed, the judicial process.

For now, Bang Si-hyuk remains free without detention as prosecutors consider the allegations surrounding HYBE’s IPO and the reported 263.1 billion won in suspected illicit gains.