South Korean Kakao Founder Accused of Manipulating K-Pop Agency Stock

Kim Beom-su, the founder of Kakao Corp., has been arrested in South Korea for allegedly manipulating stock prices during Kakao’s acquisition of a major K-pop agency, SM Entertainment. The arrest was approved by a Seoul court due to concerns of flight risk and evidence tampering.

Kim, 58, denies all allegations of the K-pop agency’s stock manipulation during the takeover. Another Kakao executive and the head of a private equity fund have also been indicted for allegedly being involved.

Per The New York Times, a bidding war broke out last year over SM Entertainment, and prosecutors believe that Kakao manipulated the price of the stock in order to “block Hybe, the company behind BTS, from acquiring the agency.”

Kakao, known for its KakaoTalk app with 41 million active users in South Korea, expressed regret over the situation and vowed to manage the impact.

According to Nikkei Asia, “Kakao is a leading South Korean information technology company created in October 2014 by a merger between Daum Communications, the operator of the Daum search engine, and Kakao, the provider of the KakaoTalk chat app. It has been adding new services, such as mobile payments, to attract more users in Southeast Asia and elsewhere.”

Though Kim has not been formally charged for the crime, prosecutors hope to question him in custody.

Other recent Korean news includes Korean Air’s plans to acquire up to 50 Boeing widebody aircraft, comprising 20 777-9s and up to 30 787-10s, with an option for 10 more 787-10s. This initiative is aimed at enhancing the airline’s capacity and operational efficiency for long-haul flights.

Moreover, Trader Joe’s “Everything but The Bagel” seasoning, celebrated for its mix of garlic, onion, and poppy seeds, faces a ban in South Korea due to concerns over narcotic contamination from poppy seeds. South Korean authorities prohibit foods with poppy seeds due to potential opiate contamination during harvesting, which could lead to positive drug tests. This ban is rigorously enforced at Incheon Airport, with recent crackdowns intensifying on narcotic-related items. Despite its popularity in the U.S. and on social media since its 2017 launch, the seasoning remains restricted in South Korea.