On April 7, news outlet Yonhap News reported about newly found evidence of Seungri taking part in Burning Sun’s management despite having claimed to only have partaken in promoting the club. Furthermore, the initial list of Burning Sun’s shareholders indicates that Yuri Holdings held more shares initially.
Two months prior, Seungri posted a statement on his Instagram account claiming that he was not involved in operating and managing Burning Sun and was simply in charge of publicly promoting the club.
The initial list of shareholders that Yonhap News obtained from a source from Burning Sun was created around November of 2017 when Burning Sun was registered as a club.
According to the document, Burning Sun was capitalized at 50 million won (approximately $44,000), and Yuri Holdings, which was established by Seungri and Yoo In Suk, had 4,000 shares in acquisition stock, which is 40 percent of the total. The form indicates the exact ownership ratio, along with the shareholders’ seals. According to the Burning Sun source, the deal was signed at Le Méridien Hotel (managed by Cheonwon Industry Co., Ltd.) with senior executives from Yuri Holdings in attendance.
However, the current shares held by Yuri Holdings, as revealed by the police, is 20 percent. The source revealed that Yuri Holdings gave half of their entire shares to Seungri’s close acquaintance Madam Lin, a Taiwanese businesswoman.
A source from Yuri Holdings stated, “According to one of the shareholders, Cheonwon Industry Co., Ltd., Madam Lin’s investment forms were not prepared in time because she was a foreigner, so the contract was established while agreeing to hand over 20 percent of the shares later.” They claimed, “At the time of signing, Seungri did not know how the shares were split.”
Yonhap News also obtained Kakao Talk messages in which Seungri delegates work to the Burning Sun staff. Seungri proposed agendas ranging from checking IDs to strengthening the staff’s sex education and stated, “Carry these out starting in early April,” using a commanding tone. This evidence goes against Seungri’s claim that he was only acting as a promoter for the club.
Hwang Ha Na reveals she used illegal drugs at celebrity friend's suggestion
During a court questioning about her drug usage and distribution charges, Hwang Ha Na claimed that she took drugs after being suggested to do so by a celebrity friend.
On April 6, the Suwon District Court issued a pre-trial detention warrant for Hwang Ha Na at 6:50 p.m. KST after questioning her to determine the validity of the warrant. The court said, “There is a concern that she may escape, so there is a need to detain her.”
Hwang Ha Na is suspected of using Philopon (a form of methamphetamine) between May to June and September of 2015 and illegally taking two medications containing Clonazepam, a psychotropic drug, in April last year. In September 2015, Hwang Ha Na was charged with violating the Narcotics Control Act under suspicions of taking 0.5 grams of Philopon with a college student identified by their last name Cho in the Gangnam district.
During the questioning, Hwang Ha Na and her lawyer admitted to all charges of drug usage. They explained that she first administered Philopon in 2015 and stopped for three years until her celebrity friend “A” suggested that she take the drug again, resulting in her using the drug from late-2018 until recent days.
Hwang Ha Na confessed, “I wanted to stop using Philopon, but I continued to do so because ‘A’ pressured me into it.” The police has begun investigating the celebrity “A” that was mentioned by Hwang Ha Na. Celebrity “A” is currently the only celebrity that has been brought up by Hwang Ha Na regarding her case, but there is a possibility that another celebrity or chaebol‘s name might be mentioned during the investigation of Hwang Ha Na and celebrity “A.” The police has stated, “Nothing can be revealed as the investigation is still ongoing.”
When asked whether she acknowledges the charges regarding the distribution of drugs, she replied that she did not. In relation to reports of her saying, “My dad is best friends with the Police Commissioner,” the court asked who the Police Commissioner in question is, and she briefly replied, “There is [no one].”
This question was asked to address the speculations that Hwang Ha Na escaped punishment using her chaebol connections. In June 2017, Jongno Police Station forwarded her case to the prosecution recommending non-indictment due to lack of evidence, and the prosecution disposed the case as “non-suspicion.” Meanwhile, Cho, who administered the drug with her, was taken to trial and sentenced to a punishment of two years and six months in prison that was suspended for three years.
After receiving information about Hwang Ha Na’s drug usage, the police began investigating her case starting in October last year. Hwang Ha Na was arrested on April 4, and she has currently admitted to the usage of drugs, but not to the distribution of it.
It appears that the investigation will continue to expand after her confession regarding celebrity “A.”
Meanwhile, Hwang Ha Na is the only granddaughter of Namyang Dairy Products’ founder. She is also an online blogger who became a hot topic when she began dating Park Yoochun in April 2017. The pair broke up in May 2018.
Seungri accused of founding a shell corporation in Hong Kong
Seungri has fallen under suspicion of establishing a shell corporation in Hong Kong.
On April 7, SBS’s “8 O’Clock News” reported that BC Holdings, Seungri’s company in Hong Kong, may be a shell corporation: a company that exists only on paper, with no building or employees. Shell companies do not have active business operations.
Seungri founded BC Holdings in 2016 together with Yoo In Suk, the then-CEO of Yuri Holdings. Seungri, Yoo In Suk, and the head of a Korean consulting firm named Ryu each invested 15,000 won (approximately $13) in the company.
SBS’s reporters traveled to the Hong Kong address listed in BC Holdings’ corporate registration in order to visit the company, but were unable to locate it. Instead of BC Holdings, the address belonged to a Korean tax law firm that had assisted in the establishment of the company. When questioned about BC Holdings, an employee of the firm stated, “This is not a matter that we can confirm. We cannot say even one letter in a client’s name without permission.”
SBS then tried visiting a past address of BC Holdings, but local office workers could only say that they did not know anything about the company. One worker commented, “I never went inside the office, but it didn’t seem like there were that many employees.”
Concluding that there appears to be no BC Holdings office in Hong Kong, SBS’s “8 O’Clock News” speculated that the company is a shell corporation.
In 2017, BC Holdings advertised on their website that they were operating with 30 billion won (approximately $26.4 million). However, when questioned about the truth of this statement, Ryu replied that while 30 billion won had been their goal, they had actually received only 10 billion won (approximately $8.8 million) in investments.
As Seungri undergoes investigations by both the Korean police and Korean tax authorities, Hong Kong tax authorities have announced that they will also be opening investigations into BC Holdings. A representative stated, “The scale of this matter appears to be very large. In the case that tax evasion has occurred, there may be criminal punishment decided in a court of law, or there may be a penalty fee of three times the evaded tax.”
SBS also reported that the major shareholders of BC Holdings recently passed on their shares all at once. Shortly after Seungri retired from the entertainment industry on March 11, he resigned from his position at BC Holdings. On March 15, he and a fellow Korean shareholder passed all of their shares to an unnamed Japanese individual, while a high-ranking Vietnamese executive at BC Holdings suddenly stepped down from his position.
A private equity expert commented that it was unusual that BC Holdings was operating on investments of 10 billion won (approximately $8.8 million) when the initial investment to establish the company was only around 40,000 won (approximately $35).
Additionally, SBS revealed that BC Holdings’ Korean office, as well as the consulting firm headed by BC Holdings co-founder Ryu, were all located in the same space as Yuri Holdings’ office.
Ryu commented, “Seungri’s company BC Holdings is merely a client for which my company provides operational advice. Although it is out of the ordinary to establish a company in Hong Kong together with a client, I was simply providing help to Seungri and Yoo In Suk, as they were unfamiliar with this line of work.”
The police are currently looking further into the matter and investigating whether it is related to offshore tax evasion.
Police investigate Seungri's birthday celebration in Palawan for alleged prostitution mediation
The police has begun investigating another set of allegations of prostitution mediation against Seungri.
On April 7, Channel A reported that the police had confirmed that eight women who attended Seungri’s 2017 birthday party, which was held in the Philippines, were professional escorts. According to the report, after questioning these women, the police were able to secure testimony that Seungri had been involved in prostitution mediation.
That same day, a source from the Seoul Metropolitan Police Agency investigation unit confirmed, “We held an investigation and questioned a number of women who attended [Seungri’s] party in Palawan regarding the allegations of prostitution mediation.”
The source also stated, “We obtained the list of the Palawan party attendees.” However, the police representative declined to provide further details, explaining, “Since the police investigation is still ongoing, it is difficult for us to confirm the exact number of people and the details of the investigation.”
The police previously launched investigations due to a 2015 text message conversation between Seungri and former Yuri Holdings CEO Yoo In Suk that appeared to indicate that Seungri had provided prostitution services to foreign investors. There were also speculations that there may have been prostitution at Seungri’s birthday party in December 2017, when the singer rented out a resort in Palawan.
The police have confirmed that Seungri paid for all of the travel expenses for the escorts who attended his party, and the police are investigating whether the travel expenses were a form of compensation for prostitution. The former singer is currently suspected of using prostitution mediation to obtain new investments from foreign investors or to retain current investments. The police have also obtained testimony that prostitution took place at another location beside Palawan.
However, Seungri has denied these allegations, stating, “There is no truth [to the claim] that I’ve mediated prostitution.” The total cost of his 2017 birthday party is estimated to be about 600 million won (approximately $527,385), and Seungri claimed that he paid all of the attendees’ travel expenses and not just those of the women suspected to be involved in prostitution mediation.
The police are also currently investigating an instance of corporate funds from Monkey Museum, a club co-operated by Seungri and former Yuri Holdings CEO Yoo In Suk, being used for personal attorney fees. However, the police have stated that it is difficult to reveal the details of the investigation, as it is still ongoing.
Meanwhile, Seungri and Yoo In Suk were recently booked on the charge of embezzling tens of millions of won (approximately tens of thousands of dollars) from their club Monkey Museum. Seungri has also fallen under suspicion of founding a shell corporation in Hong Kong, with SBS’s “8 O’Clock News” reporting that they were unable to locate a physical office for his company BC Holdings.
Sources: Naver (1, 2, 3, 4, 5, 6, 7), Yonhap News TV, XSports News, SBS News (1, 2) via Soompi (1, 2, 3, 4)
How is Seungri not in jail yet?