[Dispatch=Lee Myeong-ju Reporter] HYBE Chairman Bang Si-hyuk has been referred to the prosecution.

The Financial Crime Investigation Division of the Seoul Metropolitan Police Agency's Wide-Area Investigation Unit referred Chairman Bang to the Seoul Southern District Prosecutor's Office on an unindicted basis on the 3rd on suspicion of fraudulent transactions under the Capital Markets Act.

Other executives were also referred on the same charges. They include a HYBE representative, a former chief financial officer (CFO), a representative of Easton PE, and a representative of NewMain Equity.

This comes one year and nine months after police launched a preliminary investigation before filing charges. Police have been investigating after receiving reports that Chairman Bang reaped unfair gains during HYBE's listing process.

Chairman Bang is suspected of deceiving existing investors by telling them there were no plans for a listing ahead of HYBE's 2019 listing, then causing them to sell their stakes to a specific private equity fund.

The allegation is that he concealed his preparations for listing. While telling investors there were "no plans for a listing," he established a fund telling private equity fund contributors that there "were plans for a listing."

Ultimately, investors sold all their HYBE shares. However, about a year later, HYBE was listed. Police believe Chairman Bang and others pocketed part of the sale profit through a contract made with the private equity fund before the listing.

The police-calculated unfair gains by Chairman Bang and others total 263.1 billion won. An application for provisional seizure was filed with the court prior to prosecution, and a decision for full provisional seizure was made.

Meanwhile, Chairman Bang's side maintains that there were no illegal acts at the time of listing. His legal representatives stated, "We expect that the suspicions can be transparently resolved through subsequent procedures."

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