In a significant development involving HYBE, the entertainment powerhouse behind global sensation BTS, three employees from its subsidiaries have been charged with insider trading by South Korean prosecutors. The accusations stem from allegations that these individuals sold HYBE shares prior to a crucial announcement by BTS members regarding their temporary break, which caused a substantial market reaction.
On June 14, 2022, BTS members disclosed their decision to take a hiatus, triggering a sharp 25% drop in HYBE’s shares upon market opening. This decline translated into a staggering loss of approximately 2 trillion won ($1.4 billion), highlighting the financial impact of the announcement. Prosecutors assert that the accused employees had foreknowledge of the impending announcement and acted to avoid losses, with their transactions allegedly shielding them from financial harm ranging from $24,000 to over $108,000.
Speculation had been rife among analysts prior to the break announcement, with discussions centered on potential reasons such as mandatory military service for South Korean men, including BTS members, under the country’s conscription laws. Given South Korea’s ongoing conflict status with North Korea, military service is compulsory for nearly all able-bodied men for a period of 18 months before they turn 28.
Recently, the eldest BTS member, Jin, completed his military service, marking a milestone for the group. However, the remaining members—J-Hope, V, RM, Jimin, Jung Kook, and Suga—are currently fulfilling their service obligations. The band is anticipated to fully reunite only by June 2025, as fans eagerly await their return following Jin’s discharge earlier this month.
The legal proceedings against the HYBE employees underscore the seriousness with which South Korean authorities are addressing financial misconduct in relation to high-profile corporate events. The case also reflects the intense public and market interest surrounding BTS, whose global impact extends beyond music into cultural and economic spheres.
