K-pop leaders face reckoning amid global window of opportunity

Korea Herald

16 hours ago

As K-pop stands on the brink of a global comeback, scandals and legal troubles shake its biggest agencies from within
As K-pop braces for what could be a golden time of global resurgence — fueled by the highly anticipated return of BTS and Blackpink — its biggest threat may not be foreign competition, but the moguls within. All heads of the so-called 'big four' K-pop agencies, aside from JYP Entertainment's Park Jin-youn,g are currently embroiled in a legal case.
Bang under IPO probe
The most headline-grabbing figure is Hybe Chairman Bang Si-hyuk.
Despite his limited public appearances, Bang continues to attract outsized public attention. A video of him walking with a young female streamer in Beverly Hills last July went viral — but that was just the beginning.
Bang is currently under investigation by South Korea's Financial Supervisory Service over allegations of pre-initial public offering misconduct. He is suspected of misleading early investors by claiming Hybe (then Big Hit Entertainment) had no plans to go public, while secretly arranging share sales to a private equity fund linked to an associate.
The deal reportedly generated massive profits, a portion of which may have gone to Bang, raising concerns of securities fraud. The case was referred to prosecutors in June for potential criminal charges.
Hybe has denied wrongdoing, stating that it never concealed its IPO plans and that both listing and investment options were openly discussed with investors. The company claimed that former shareholders sold their stakes based on their own judgment, fully aware of the company's strategic direction.
Separately, Bang has been summoned as a witness in a stock manipulation trial involving Kakao's 2023 takeover battle for SM Entertainment. While not a suspect in the case, he is expected to testify about his role in behind-the-scenes negotiations during the high-stakes acquisition. However, Bang declined to appear in court Tuesday — a move that has raised questions about transparency and his actual involvement.
Yang faces customs charges
On June 4, YG Entertainment Executive Producer Yang Hyun-suk appeared in a Seoul court to face charges of violating the Act on the Aggravated Punishment of Specific Crimes related to customs evasion.
He is accused of bringing two luxury Swiss watches, worth approximately 241 million won ($176,000), into Korea without declaring them after allegedly receiving the items as gifts in Singapore in 2014.
Yang has argued that celebrity sponsorships are an industry norm. But this claim was challenged by a representative of the watch brand, who testified that all official endorsements must be approved by the brand's Swiss headquarters and that gifting to celebrities is not permitted.
Yang's legal team countered that it remains unclear when and where the watches were received, citing inconsistent statements from the brand's regional executive.
EXO members sue SM executives
At SM Entertainment, co-CEO Tak Young-jun and Chief A&R Officer Lee Sung-soo have been sued for fraud under the Act on the Aggravated Punishment of Specific Economic Crimes by three members of EXO — Chen, Baekhyun and Xiumin, also known as CBX.
The trio accused the two leaders of withholding transparent payment records and enforcing excessively long-term contracts, prompting them to seek termination of their exclusive agreements in mid-2023.
Although the dispute appeared to be resolved temporarily when the members agreed to continue EXO-related group activities under SM Entertainment, tensions resurfaced months later over the distribution of revenue from their solo promotions.
The conflict escalated after Baekhyun's independent label INB100 — which also manages Chen and Xiumin — became affiliated with One Hundred Label. SM Entertainment responded by accusing the artists of tampering, alleging they had engaged in unauthorized outside negotiations.
In retaliation, CBX filed a criminal complaint against Tak and Lee, accusing them of manipulating royalty payments. SM Entertainment then launched a civil lawsuit demanding that the artists honor their original contracts. Both cases remain ongoing in court.