South Korean Police Seek Warrant for HYBE Founder in Fraud Probe

South Korean police are seeking an arrest warrant for Bang Si-hyuk, the founder and chairman of HYBE, the entertainment company behind the K-pop group BTS, as part of an ongoing investigation into alleged investor fraud related to the firm's 2020 initial public offering.

The Seoul Metropolitan Police Agency announced on Tuesday that it has requested prosecutors to obtain a court warrant for Bang's detention. Authorities suspect Bang of violating capital markets laws by misleading early investors in 2019. According to police, Bang informed investors that HYBE, then known as Big Hit Entertainment, had no plans to go public, encouraging them to sell their shares at a low price to a private equity fund connected to his associates. After HYBE listed on the stock exchange, the fund sold its stake, and Bang allegedly received about 30 percent of the profits under a prior agreement, netting him approximately 190 billion won, or roughly $140 million, in illicit gains.

Bang, who established HYBE in 2005 as a music production and artist management firm, has been under scrutiny since November. He has denied any wrongdoing. HYBE representatives did not immediately respond to requests for...