The Seoul Metropolitan Police Agency’s Financial Crime Investigation Unit submitted a request to the Seoul Southern District Prosecutors’ Office on Tuesday (April 21) seeking an arrest warrant for HYBE chairman and founder Bang Si-hyuk on suspicion of fraudulent unfair trading under South Korea’s Capital Markets Act. Bang has denied wrongdoing. A court must still approve the warrant before any detention can occur, with prosecutors expected to schedule a preliminary hearing within 48 to 72 hours of accepting the filing.
The allegations center on share transactions carried out ahead of HYBE’s IPO. Investigators allege that in 2019, Bang misled existing investors by telling them the company had no plans to go public, inducing them to sell their stakes into a private-equity-linked structure. HYBE then proceeded with its IPO, and police believe Bang collected approximately 30% of the post-listing gains through a prior undisclosed arrangement with that fund. The alleged profit is widely reported at around 190 billion won, or roughly $129 million. Under South Korea’s Capital Markets Act, any individual found to have generated 5 billion won or more through false representations about a financial product faces a minimum five-year prison term, with life imprisonment as the upper bound.
Bang has been barred from leaving South Korea since August 2025 and has been questioned by investigators five times. Police also searched both HYBE headquarters and the Korea Exchange as part of the probe. HYBE shares closed down 2.4% on Tuesday, while South Korea’s benchmark KOSPI rose 2.7% to a fresh intraday high.
The case has drawn an unexpected diplomatic dimension. Korea’s National Police Agency confirmed that the US Embassy in Seoul sent a letter requesting that Bang be permitted to travel to the United States despite the travel ban, seeking a temporary suspension so Bang and other senior HYBE executives could attend a July 4th event and hold meetings related to BTS’s ongoing world tour. HYBE denied requesting the embassy’s involvement, according to the Korea Herald. The embassy declined to comment further.
Bang’s legal counsel issued a statement Tuesday: “We regret that a detention warrant has been sought despite our full and consistent cooperation with the investigation over an extended period. We will continue to cooperate with all legal procedures and make every effort to clearly explain our position.”
The timing puts significant institutional pressure on HYBE at one of the most commercially significant moments in the company’s history. BTS returned to live performance following a nearly four-year hiatus for mandatory military service, drawing 132,000 attendees across three nights at Goyang Stadium earlier this month. The ARIRANG World Tour opens its US leg at Raymond James Stadium in Tampa on April 25, 26, and 28. The legal cloud over the company’s founder and chairman arrives precisely as its flagship act begins its most anticipated run of shows in years, and as ARIRANG has spent three consecutive weeks at No. 1 on the Billboard 200.
Beyond BTS, HYBE’s roster includes Seventeen, LE SSERAFIM, ENHYPEN, and Katseye. Bang founded the company in 2005 under its original name Big Hit Entertainment before restructuring it into HYBE in 2021, the same year it completed a $1 billion acquisition of Ithaca Holdings. The company has faced internal turbulence in recent years, including a prolonged legal dispute with former ADOR CEO Min Hee-jin over control of NewJeans that played out publicly through 2025. The arrest warrant request represents a new and more serious dimension of that institutional instability.
