This file photo shows an exterior view of the main building of Hybe, the South Korean entertainment giant behind K-pop supergroup BTS, in Seoul. (Image courtesy of Yonhap)
SEOUL, July 29 (Korea Bizwire) — The National Tax Service (NTS) has launched a tax investigation into K-pop powerhouse Hybe over alleged fraudulent securities transactions related to the company’s initial public offering (IPO), industry sources said Tuesday.
According to the sources, the NTS dispatched an investigative team to Hybe’s headquarters in Seoul’s Yongsan district earlier in the day to seize documents and materials related to the allegations. The company is behind such global acts as BTS and Seventeen.
Hybe is already under separate investigation by the Securities and Futures Commission under the Financial Services Commission over allegations that its chairman, Bang Si-hyuk, engaged in unfair trading practices.
Bang is accused of misleading investors, including venture capital firms, in 2019 by claiming that Hybe’s IPO would be delayed, inducing them to sell their shares to a special purpose company (SPC) established by a private equity fund backed by Hybe executives.
Authorities believe Hybe was already preparing for its IPO at the time, contradicting what was conveyed to investors. After the company went public, the SPC sold its shares, and Bang reportedly received 30 percent of the profit from the sale under a prior shareholder agreement.
Tax authorities are expected to closely examine whether Hybe engaged in any tax evasion during the process.
(Yonhap)
