HYBE’s Bang Si-hyuk to Be Referred to Prosecutors This Week Over Alleged $145 Million Pre-IPO Fraud
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Twenty months after South Korean police first opened an investigation into HYBE chairman Bang Si-hyuk, the case is finally leaving their hands.
On Monday, Hong Seok-ki, head of the National Office of Investigation, told reporters at a regular press briefing in Seoul that Bang’s case would be forwarded to prosecutors “within the week.”
It’s the most concrete development in a legal saga that, as we covered back in July, has been defined by delay: two rejected arrest warrants, months of “supplementary investigation” requests, and reports that prosecutors themselves weren’t convinced the central charge against Bang could be proven at all.
A referral doesn’t resolve any of that. But it does mark the formal end of the police investigation and the start of whatever comes next, which will now be decided by the Seoul Southern District Prosecutors’ Office rather than by police.
What Was Actually Said
Speaking at the National Office of Investigation’s headquarters in Seodaemun-gu, Hong told reporters the Bang case was “essentially at the stage just before referral” and that his team expected it to be sent to prosecutors before the week is out.
Asked directly whether police would request Bang’s detention alongside the referral, Hong was notably non-committal, saying only that the direction on his physical custody “will become clear around the time of referral.”
That’s a meaningfully softer statement than some of the English-language coverage of Monday’s briefing suggested.
Several outlets, citing sources close to the investigation, reported that police are expected to refer the case without seeking detention β effectively predicting the outcome before it’s confirmed.
Hong’s own on-record quote is more careful, framing the detention question as still open rather than settled. Given how this case has already produced two warrant applications that didn’t survive prosecutorial review, that distinction is worth keeping in mind: the safest read right now is that a no-detention referral is the expected outcome, not a locked-in one.
The Allegations, One More Time
The core of the case hasn’t changed since police first went public with it. Investigators allege that in 2019, before HYBE (then Big Hit Entertainment) went public, Bang misled early investors β including venture capital firms β into believing the company’s IPO plans had stalled or wouldn’t proceed on the timeline they’d been told.
Acting on that impression, those investors sold their HYBE stakes to a special purpose company set up by a private equity fund with ties to HYBE executives.
HYBE, according to regulators, was in fact actively preparing for its listing at the time, including work already underway with an auditor.
Once the IPO went through and the SPC later sold off its HYBE shares, Bang is alleged to have collected roughly 30% of the resulting profit through a shareholder agreement arranged in advance β a structure investigators say was designed to route around IPO lock-up rules meant to stop major shareholders from cashing out early.
Police now put Bang’s take from the deal at close to 200 billion won, or about $145 million, a figure that has stayed roughly consistent β inching from an initial estimate near $129 million to $137 million and now close to $145 million as the investigation progressed and the won-dollar conversion shifted.
How the Case Got Here
The timeline is long enough that it’s worth laying out in full. Financial regulators first flagged the matter in December 2024, and police opened a full-scale probe in July 2025 that included a search of HYBE’s Yongsan headquarters.
The Financial Services Commission formally referred Bang and three other executives to prosecutors on related suspicions the same month.
Bang was questioned by police five times over the following months and has been under a standing travel ban since August 2025 β a restriction significant enough that the U.S. Embassy in Seoul reportedly intervened to ensure he could still travel for BTS’s world tour commitments.
Police first sought an arrest warrant for Bang in April 2026, arguing the investigation was essentially complete. The Seoul Southern District Prosecutors’ Office rejected it within days, citing insufficient evidence to justify detention and ordering further investigation.
Police refiled just under a week later; prosecutors rejected that version too, and did so more decisively than the first time, declining to even forward it to a judge for consideration.
Police spent much of May publicly weighing whether to try a third time, before appearing to abandon that approach altogether in favor of building toward a referral instead.
Then, in July, legal trade press reported something more unusual: prosecutors had told police the evidence gathered might not support the specific charge the entire investigation was built around β “fraudulent trading” under the Capital Markets Act, which requires proving that Bang’s conduct distorted the capital markets system itself, not just that individual investors were misled.
Prosecutors reportedly floated the idea of police pursuing Bang under ordinary fraud statutes instead, which carry a different evidentiary bar.
The Open Question Monday’s News Doesn’t Answer
That July report is what makes this week’s referral more interesting than a routine procedural update. Korean coverage of Monday’s briefing continues to describe the case police are sending forward as one of “μ¬κΈ°μ λΆμ κ±°λ” β fraudulent unfair trading β the same Capital Markets Act violation that was reportedly on shaky ground with prosecutors just weeks ago.
Nothing in Monday’s reporting indicates police pivoted to the alternative fraud theory prosecutors floated in July, and nothing confirms they didn’t.
In other words, police appear to be sending prosecutors largely the same case, under largely the same legal theory, that prosecutors themselves had signaled doubts about. That could mean the doubts were resolved through additional evidence gathered over the summer.
It could also mean the charge question simply gets litigated at the referral stage instead of before it, with prosecutors free to decline, downgrade, or reshape the case once it’s formally in their hands β something they can’t do with a police investigation they haven’t yet received.
Either way, referral is not the same as indictment, and it’s worth being clear-eyed about that distinction as headlines frame this as HYBE’s chairman “facing prosecution.”
What Happens From Here
Once the case is formally referred β expected by the end of this week β it moves to the Financial and Securities Crime Joint Investigation Unit at the Seoul Southern District Prosecutors’ Office, the same unit that has already reviewed and rejected two detention requests tied to this investigation.
Prosecutors will have to decide independently whether to indict Bang, on what charge, and whether to pursue his detention themselves β none of which is bound by the police’s own conclusions.
If prosecutors do request an indictment without detention, Bang would continue operating as HYBE’s chairman while the case proceeds through the courts, a process that in South Korea can extend well beyond the point of formal charges being filed.
If they decide the evidentiary gap flagged in July hasn’t closed, further delay β or a request for more supplementary investigation, sending the matter partly back to police β remains possible too.
The Backdrop That Hasn’t Changed
None of this has visibly slowed HYBE’s day-to-day business. BTS has continued its “ARIRANG” world tour largely without interruption, and individual members have kept expanding outside ventures β V’s ambassadorship for soju brand JINRO, announced earlier this summer, being one recent example.
But the corporate-governance overhang tied to Bang’s legal exposure has been repeatedly cited by Korean financial media as a drag on investor sentiment, even during a stretch that HYBE itself has described as heading toward record quarterly results.
That contradiction β a company posting some of its best commercial numbers ever while its founder and controlling shareholder faces a referral to prosecutors β has been the throughline of this story for more than a year now.
Monday’s announcement doesn’t resolve it. It just moves the uncertainty from a police station to a prosecutor’s desk, with the timeline for what comes next about as unpredictable as it’s been at any point since the investigation began.
This is a developing story, and we’ll update as prosecutors confirm receipt of the case and any decision on Bang’s detention status becomes public.