Employees of a subsidiary who sold HYBE stocks after knowing in advance about the temporary suspension of group activities due to BTS members' enlistment have been sentenced to a suspended prison term in the first trial.
The Seoul Southern District Court's 13th Criminal Division sentenced Kim, a 37-year-old former employee of Source Music, to 10 months in prison, a 2-year suspended sentence, and a fine of 231 million won for violating the Capital Markets Act.
Kim and another former employee of Big Hit Music, Lee, 33, who were indicted without detention, received 6 months in prison, a 2-year suspended sentence, and a fine of 51 million won, while another former employee of Belift Lab, Kim, 41, received 6 months in prison, a 2-year suspended sentence, and a fine of 65 million won. The court also ordered them to forfeit an amount equivalent to the losses they avoided by trading on undisclosed important information.
These former employees of a HYBE subsidiary are accused of avoiding losses of about 230 million won by selling all their HYBE stocks after knowing in advance that BTS would release a YouTube video announcing a temporary suspension of group activities due to member Jin's enlistment on June 14, 2022.
The day after the announcement of the temporary suspension of BTS activities, HYBE's stock price plummeted by 24.78%. The court pointed out that "in the case of entertainment companies, the activities of affiliated artists significantly affect sales, so whether to suspend activities is a sensitive issue," and noted that "this crime is a serious offense that undermines the public nature of the capital market, carrying a high potential for social condemnation."