South Korean police have asked prosecutors to indict Bang Si-Hyuk, the billionaire music executive behind K-pop giant HYBE and supergroup BTS, over allegations that he misled investors before the company went public.
The Seoul Metropolitan Police Agency referred Bang's case to the Seoul Southern District Prosecutors' Office on Thursday, recommending his indictment for allegedly violating the country's capital markets law, according to police and prosecutors.
Bang, HYBE's founder and chairman, has been under investigation over allegations that he misled investors in 2019 by telling them the company had no immediate plans to go public.
Police allege that the investors later sold their shares to a private equity fund shortly before HYBE launched its initial public offering.
Investigators have previously said the private equity fund may have paid Bang around 200 billion won, or about $147 million, under a separate agreement that entitled him to 30% of profits from stock sales following the company's IPO.
South Korean media reported that police also referred four other people to prosecutors on Thursday, including HYBE executives and officials linked to the private equity fund, recommending their indictment.
Bang and HYBE have denied any wrongdoing.
“We have consistently responded to the allegations with objective evidence and facts,” Bang's legal team said in a statement Thursday, adding that it expects the matter to be resolved fairly and transparently through the legal process.
Police had previously sought Bang's arrest twice, in April and May, but prosecutors rejected both requests, saying there were insufficient grounds for his arrest and ordering further investigation.
Legal observers say prosecutors may seek additional investigation before deciding whether to formally indict Bang.
The latest development comes as BTS returned to the global music scene and launched a highly anticipated world tour earlier this year, following a nearly four-year break caused by the members' mandatory military service in South Korea.