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HYBE to request investigation by financial watchdog into allegations of stock market misconduct

According to a report from Korea Economic Daily on May 14 KST, HYBE is set to ask the Financial Surveillance Service to open an investigation into allegations of stock trading misconduct by executives, including the vice president. LOVE, in the middle of a management conflict. The petition specifically cites violations of the Capital Markets Act, including spreading rumors and using undisclosed information.

HYBE’s petition also targets other ADOR executives, including CEO Min Hee Jin, in light of allegations of fraudulent trading aimed at manipulating the stock market. The allegations include spreading false information about artists under HYBE labels while plagiarizing others, leading to a negative impact on stock prices and subsequent losses for investors.

The investigation stems from Vice Chairman ADOR’s sale of all 950 HYBE shares, valued at 200 million won, on April 15. This sale took place just before ADOR management sent a communication raising suspicions about the management of HYBE, which would be based on undisclosed information. The timing of the sale, as well as subsequent developments, raised concerns about insider trading.

In response, Vice Chairman ADOR refuted the allegations, stating that the sale of shares was intended to raise funds for directors’ retainers and that there were no ulterior motives involved.

HYBE also called for an investigation into CEO Min Hee Jin, alleging that she knew in advance about the company’s stock price decline and conspired to manipulate public opinion. It is reported that HYBE will provide evidence, including chat room discussions, to support these claims during the ADOR audit.

The ongoing conflict between HYBE and CEO Min Hee Jin further intensified when HYBE filed a lawsuit against her and Vice Chairman Shin for breach of trust. CEO Min Hee Jin has vehemently denied allegations of plans to usurp management rights and criticized what she perceives as discrimination against NewJeansa group under his leadership.

With an extraordinary general meeting of shareholders scheduled for May 31, where the dismissal of CEO Min Hee Jin is on the agenda, tensions between the two parties are expected to continue as legal proceedings unfold.

SEE ALSO: ADOR Board of Directors and CEO Min Hee Jin to hold meeting this week