Prosecutors Reject Request Again for Arrest Warrant for Bang Si-hyuk, Citing Failure to Carry Out Supplementary Investigation

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[The Financial News] Prosecutors have again rejected an arrest warrant requested by police for Bang Si-hyuk, chairman of HYBE, who is accused of deceiving investors ahead of the company’s initial public offering and inducing them to sell their shares.
According to the legal community on the 7th, the Joint Financial and Securities Crime Investigation Unit at the Seoul Southern District Prosecutors' Office rejected the warrant the previous day after the Seoul Metropolitan Police Agency's Financial Crime Investigation Unit resubmitted it on the 30th of last month. Prosecutors said, "After reviewing the arrest warrant, we found that the matters for which supplementary investigation had been requested were not carried out."
Earlier, the Financial Crime Investigation Unit of the Seoul Metropolitan Police Agency had requested an initial arrest warrant for Bang on the 21st of last month, but prosecutors returned it on the 24th, asking for supplementary investigation. At the time, prosecutors said, "We determined that there was insufficient explanation for the reasons why detention was necessary at this stage, so we requested supplementary investigation."
Police then resubmitted the warrant for Bang on the 30th of last month, six days after prosecutors asked for additional investigation. However, prosecutors again rejected it, saying the requested supplementary investigation had not been completed.
Bang is accused of telling existing investors in 2019, before HYBE's listing, that there were "no plans for a stock listing," inducing them to sell their holdings to a private equity fund linked to him, and then later pushing ahead with the IPO.
Police believe Bang secured illicit gains totaling about 260 billion won, including roughly 190 billion won, through a structure under a private agreement with the fund that gave him 30% of the sale profits after the listing.
The Financial Investment Services and Capital Markets Act prohibits making profits from transactions involving financial investment products, including unlisted shares, by using false information or fraudulent schemes. Violators who gain more than 5 billion won face life imprisonment or at least five years in prison.
Police launched a formal investigation after receiving intelligence on Bang in late 2024, and later raided the Korea Exchange (KRX) and HYBE in June and July last year.
In early August last year, they imposed a travel ban on Bang after he returned from the United States, and questioned him five times between September and November. They also froze HYBE shares worth 156.8 billion won that he held through a court order.
welcome@fnnews.com Jang Yu-ha Reporter