HYBE’s founder and chairman, Bang Si-hyuk, told employees in a leaked internal email that he plans to return to Seoul to face authorities investigating allegations of securities fraud connected to the company’s 2020 initial public offering.

In an email to employees Wednesday (August 6), which was obtained by Forbes and The Korea Herald, Bang acknowledged that his extended absence abroad may have contributed to “confusion and frustration” within the company.

Bang wrote: “Over the last year, much has been said and written about me in the press. Increasingly, I believe these events are causing confusion and concern for you, as well as our artists, fans, and partners.”

The executive has been in the US overseeing business, and has been focused on BTS’ reunion and other HYBE artists outside Korea, according to Forbes, which cited source with connections to the company.

Bang told staff: “I will return to Korea to fully and transparently work with investigators and put these allegations to rest.”

“Over the last year, much has been said and written about me in the press. Increasingly, I believe these events are causing confusion and concern for you, as well as our artists, fans, and partners.”

Bang Si-Hyuk, HYBE

He added: “In particular, I feel a deep sense of regret knowing that our members and artists, who should be focused solely on their creative and professional goals, might be suffering because of this situation.”

As MBW previously reported, Bang and three other executives at the company have been referred to prosecutors in an investigation of alleged “unfair trading” in connection with the company’s IPO.

According to Korea Economic Daily, regulators are probing whether Bang enriched himself unjustly by misleading HYBE investors, including venture capital firms, into believing that the company’s 2020 IPO would be delayed.

Regulators stated that the IPO plans were actually on track, with HYBE even hiring an auditor. However, investors, believing there would be a delay, reportedly sold their shares to a special purpose company supported by HYBE’s executives.

“I will return to Korea to fully and transparently work with investigators and put these allegations to rest.”

Bang Si-Hyuk, HYBE

This company sold its shares after the IPO, and Bang allegedly pocketed 30% of the profits, or around 190 billion won (USD $137 million at the current exchange rate), regulators say.

That’s a somewhat lower figure than the 400 billion won that had been previously reported.

According to The Korea Herald, fraudulent trading that generates profits or prevents losses exceeding 5 billion won can result in sentences ranging from five years to life imprisonment.

Bang reportedly told staff in his new email: “I care deeply for what we do and have immense respect for everyone at HYBE who has worked tirelessly to elevate K-pop and Korea’s place in global culture. It’s extremely unfair that these events should overshadow your efforts.”

Shares of HYBE were up nearly 7% in Seoul trading late Thursday afternoon (August 7).

On Wednesday (August 6), HYBE reported a 10.2% YoY jump in Q2 revenue to 705.6 billion South Korean won ($507.5m), while operating profit jumped 29% YoY to 65.9 billion won ($47m).

You can read Bang’s full email, as reported by The Korea Herald, below:

To the HYBE team

Over the last year, much has been said and written about me in the press. Increasingly, I believe these events are causing confusion and concern for you, as well as our artists, fans, and partners.

As founder and chairman, I feel a deep sense of responsibility to do everything in my power to ensure nothing takes away from the hard-earned attention and praise your work continues to receive. I care deeply for what we do and have immense respect for everyone at HYBE who has worked tirelessly to elevate K-pop and Korea’s place in global culture.

It’s extremely unfair that these events should overshadow your efforts. That’s why I will return to Korea to fully and transparently work with investigators and put these allegations to rest.

HYBE was the starting point of a journey to realize my ideals and dreams as a creator. From the beginning, we sought to create an environment where creatives and artists could fully express their unique voices and freely pursue their dreams.

What began as a simple hope has become the foundation for artists, creators, and so many others in the industry. I’m deeply grateful that this dream has resonated with people everywhere. That’s why these past few months have been so painful.

I’ve tried to remain cautious with my words out of respect for ongoing legal proceedings, yet it has been difficult not to respond to these allegations. While I’ve instead focused on supporting BTS and other HYBE artists and advancing key business opportunities overseas, my continued time abroad has been prolonged. I understand how my absence may have contributed to confusion and frustration.

By returning to Korea, it will be easier for me to fully cooperate with authorities to address these allegations and alleviate any stress or anxiety these events have caused our community. In particular, I feel a deep sense of regret knowing that our members and artists, who should be focused solely on their creative and professional goals, might be suffering because of this situation.

I am committed to a swift resolution to these matters, so that you may focus on what you do best: creating and sharing entertainment and culture that resonates around the world.

While I navigate these events at home, I want to express my infinite appreciation to all of you at HYBE who have continued to produce only the highest quality work. Our team’s devoted efforts, our creators’ passion, and our artists’ talent are HYBE’s most powerful growth engine and the bedrock that sustains our company.

Your work is what carries HYBE forward. Thank you for giving your best every day—I will do the same.

Sincerely,
Chairman Bang

Music Business Worldwide

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It could signal an intention to amend the Federal Reserve Act and diminish policymakers’ independence, according to analysts at JPMorgan.

On Thursday, President Donald Trump named Miran, the chair of the White House’s Council of Economic Advisers, to fill a vacancy left by Adriana Kugler, who stepped down before her term was due to expire in January.

While he is known for a proposal authored before joining the administration that’s been dubbed the “Mar-a-Lago Accord” to address the U.S. trade deficit, another paper he cowrote in 2024 calling for the overhaul of the Federal Reserve is gaining more attention now.

In a note on Friday, JPMorgan analysts led by chief economist Bruce Kasman highlighted key proposals, such as giving at-will power to the U.S. president to fire Fed board members and Fed bank presidents, giving Congress control of the Fed’s operating budget, and shifting the Fed’s regulatory responsibility over banks and financial markets to the Treasury. 

“There is little doubt that the consequence of these reforms would be to materially increase the influence of the president over US monetary and regulatory policy,” analysts wrote.

Such changes would require approval from Congress, and JPMorgan pointed out that it’s not clear support for such broad changes exists.

But what is clear is that Miran is joining the Fed board—armed with a reform agenda. His 2024 paper accused the Fed of suffering from “groupthink” and mission creep, arguing that changes to the Fed would actually help preserve its independence. JPMorgan doesn’t see it that way.

“The main threat to the Fed independence is not politically motivated turnover shifting the outcome of votes,” analysts said. “Rather, the appointment fuels an existential threat as the administration looks likely to take aim at the Federal Reserve Act to permanently alter US monetary and regulatory authority.”

The White House didn’t immediately respond to a request for comment.

How the Fed could play defense

Congress has the power to modify the central bank’s authority and mission. Wharton finance professor Jeremy Siegel flagged this potential last month, when he told CNBC that Powell may need to resign in order to preserve the Fed’s long-term independence. 

His reasoning: if the economy stumbles, then Trump can point to Powell as the “perfect scapegoat” and ask Congress to give him more power over the Fed.

“That is a threat. Don’t forget, our Federal Reserve is not at all a part of our Constitution. It’s a creature of the U.S. Congress, created by the Federal Reserve Act 1913. All its powers devolve from Congress,” Siegel explained. “Congress has amended the Federal Reserve Act many times. It could do it again. It could give powers. It could take away powers.”

Sen. Bernie Moreno, R-Ohio, signaled willingness last week to amend the Federal Reserve Act, including the interest it pays on bank reserves and its dual mandate, though he said he believes in central bank independence.

JPMorgan said the Fed still enjoys support in the Senate, where changes to the Federal Reserve Act would need 60 votes to overcome a filibuster.

Still, the Fed will also take the threat to its independence seriously and actively protect it, which could mean “some accommodation” toward demands from the White House and Congress, analysts predicted.

“While dramatic shifts are not expected, the coming pressure on the Federal Reserve Act could bias Fed policy dovishly and regulatory decisions in a direction that lightens burdens,” they said.

A tilt toward monetary easing would come amid relentless pressure from the White House to cut rates, which have remained unchanged as Fed officials eye inflationary pressure from Trump’s tariffs.

Independence is meant to insulate the Fed from such political pressure. But Fed independence is a tricky concept, as it largely derives from a mix of laws, norms, informal agreements and traditions, Michael Pugliese, senior economist at Wells Fargo, told Fortune in an earlier interview.

He thinks it’s highly unlikely Congress will amend the Federal Reserve Act to allow for more explicit influence from the White House.

That’s because Democrats wouldn’t go along with it, and Republicans probably wouldn’t get rid of the filibuster rule in the Senate to immediately erode the Fed’s independence, he said.

“Getting rid of the filibuster would probably open the door to tons and tons and tons of other policy discussions on a lot of different issues, not just the Federal Reserve Act,” Pugliese explained. “The filibuster has stuck around as long as it has because both parties have had reasons and cause to not change it. And maybe that changes one day, but I would be very surprised if the thing that changed it was the Fed.”