Hello.
Last Thursday (July 24), Music Business Worldwide posted an accurate story covering three individuals being sentenced for insider trading in South Korea.
The article in question cited and credited a report from KoreaJoonAngDaily – the English edition of the South Korean national daily newspaper, JoongAng Ilbo.
It stated that three people affiliated with HYBE – reported by JoonAngDaily as two ex-employees plus one employee of a subsidiary – had been convicted of insider trading in Korea.
The trio was found to have benefited from privileged knowledge regarding BTS’s official confirmation of their “hiatus” — due to military enlistment — in June 2022.
The correction that wasn’t a correction
After publishing our story, late on Thursday GMT (July 24), MBW was contacted by Los Angeles-based Tag PR, aka The Agency Group PR LLC, with an urgent correction request.
Tag PR stated (bolding and underlining as received): “Clarification: None of the three registered officers were former HYBE employees. Only one individual was known to be an acquaintance of Chairman Bang Si-Hyuk.”
Relevant detail: The Agency Group LLC was majority-acquired by HYBE last year, with the American arm of HYBE — then run by Scooter Braun — reportedly buying a 51% stake in the PR company.
After being contacted by HYBE-owned Tag PR, MBW duly updated our story with its statement; we noted that HYBE (via its majority-owned subsidiary) had “strongly denied” that any ex-employees had been sentenced in the insider trading conviction.
Then things… took a turn.
Early on Friday morning (July 25), HYBE’s Seoul-based global head of communications, Rachel Um, contacted us via email to issue a correction… to the correction MBW received from Tag PR the previous day.
This email from HYBE HQ read: “Regarding [MBW’s] piece from yesterday, it’s confirmed that the three individuals addressed were all former HYBE employees as they were charged with insider trading. They had all left HYBE by then. While they did work at HYBE, they had no personal connections with Chairman Bang.”
HYBE blamed “human error” for Tag PR’s erroneous request to correct MBW’s article with false information.
So, to reiterate:
- The three individuals sentenced for insider trading did all, at some point, actually work for HYBE (as MBW reported in the first place).
- HYBE says, officially, none of them were acquaintances of Chairman Bang (which MBW never suggested in the first place).
The relevance of accuracy in this matter, especially in terms of the individuals’ connection (or lack of) to HYBE founder Chairman Bang Si-Hyuk, will be of significant importance to HYBE shareholders.
Bang Si-Hyuk and three separate HYBE employees were recently referred to Korean prosecutors in a different investigation of alleged “unfair trading”, connected to the company’s 2020 IPO. (Again: this investigation is unrelated to the BTS insider trading case; the three employees in each matter differ.)
HYBE says it is “fully cooperating with local authorities, including the financial regulators and the police,” in the Chairman Bang prosecutorial investigation.
MBW is aware we are read closely by HYBE investors and analysts, and thought it best to be as clear as possible on last week’s events. Hence this letter.
You can read our (twice updated) coverage on the BTS insider trading conviction here.Music Business Worldwide
