Jun Won Corporation has issued a statement in response to reports suspecting the company of embezzlement.
Jun Won Corporation is the company that previously manged Le Méridien Hotel, where Burning Sun is located. It was reported that Jun Won Corporation invested around 1.2 billion won (approximately $1,077,810) into Burning Sun.
On April 12, Jun Won Corporation stated through a press release, “We are here to report that suspicions of Jun Won Corporation’s embezzlement are not true.”
The company first denied a report made by MBC’s “Newsdesk” on April 11, which stated that Jun Won Corporation had rented out 1,000 square meters of space to Burning Sun at a monthly payment of 16.66 million won (approximately $14,700). MBC stated that police had found Burning Sun paying over 100 million won (approximately $88,200) in rent money, which is six times the initial amount. According to the report, police launched into an investigation as they suspected that this money was not for rent, but instead money that diverted Burning Sun’s profits to Jun Won Corporation. It was also reported that the scale of Jun Won Corporation and Seungri’s embezzlement amounted to 600 million won (approximately $529,000)
In response to this, Jun Won Corporation stated that because it normally takes a business at least six months to get to a stable state after its opening, the initial rent for Burning Sun was set at 16.66 million won. Three months after Burning Sun’s opening, however, the monthly rent was raised to 100 million won to meet the market price of the surrounding area. Jun Won Corporation explained that this rent was issued monthly based on rental sales, and that Burning Sun also properly handled the accounting through a bank account for the rental payments. According to the company, this information can be found in the National Tax Service’s records as well.
Jun Won Corporation also added that the allegations of the company receiving Burning Sun’s profit “dividends” in the name of “rent” was not true, as if it really were the dividend, it should vary in proportion to monthly sales. However, the rent received by Jun Won Corporation was fixed at 100 million won per month.
The company then explained that it did not give Burning Sun favorable treatment by initially setting the rent at 16.66 million won, and that the rent was raised after mutual agreement. It also revealed that the company was investigated by the police on April 11 and would participate in future investigations if needed, while actively addressing any suspicions that are untrue.
Jun Won Corporation clarified that it had not been involved in the management of Burning Sun, and that the rumors of it being the de facto owner of the club are not true either. It had only invested in Burning Sun Entertainment after highly regarding Seungri’s business value.
In regards to its lease with Burning Sun, which had been upheld from late December 2017 to February 2018, Jun Won Corporation revealed that the ongoing issued had caused investment losses. Due to this, the company terminated its contract with Burning Sun and requested procedures for corporate liquidation.
Jun Won Corporation concluded it will take legal actions against reports stating that Jun Won Corporation was the actual owner of Burning Sun, and said that the Le Méridien Hotel chain had nothing to do with the Burning Sun issues.
On April 11, Seungri and former Yuri Holdings CEO Yoo In Suk were booked on suspicions of embezzling funds from Burning Sun.
Seungri suspected of paying manager's salary using Burning Sun funds
Seungri has been suspected of paying his manager’s monthly salary using funds from the club Burning Sun.
According to the April 12 broadcast of MBC’s “Newsdesk,” police investigating the suspicious flow of funds in Burning Sun’s bank account found that more than 30 million won (approximately $26,450) in Burning Sun funds were paid regularly every month to Mr. Ji, Seungri’s former manager.
Although Mr. Ji was an employee of YG Entertainment and not Burning Sun, the club deposited 3 million won (approximately $2,645) every month under the pretext of giving Mr. Ji his monthly salary.
MBC also reported that YG Entertainment had already known about this after questioning Seungri in February when “Burning Sun Gate” first broke out. After confirming that Seungri had indeed paid Mr. Ji using funds from Burning Sun, the company reportedly fired Mr. Ji.
If Mr. Ji’s salary was paid by Burning Sun, instead of Seungri himself or the agency, Seungri may be charged with embezzlement.
The source of Mr. Ji’s salary has yet to be confirmed. It is unclear if Mr. Ji received his salary from YG Entertainment, Burning Sun, or if he received double his salary from both places. A source from the police stated, “We are currently analyzing confiscated items to determine where the money came from.”
Although a reporter from MBC contacted YG Entertainment to ask about the agency’s contractual relationship with Mr. Ji, the agency did not give any response.
YG responds to reports of Seungri using Burning Sun funds to pay manager's salary
YG Entertainment has released an official statement in response to a report that Seungri allegedly used funds from the club Burning Sun to pay his manager’s monthly salary.
On April 12, MBC’s “Newsdesk” reported that police had found that Burning Sun had paid Seungri’s former manager, Mr. Ji, more than 30 million won (approximately $26,450) every month under the pretext of paying him his monthly salary, despite the fact that he was an employee of YG Entertainment and not Burning Sun.
The news program also claimed that YG Entertainment had become aware of the situation in February, after questioning Seungri when the Burning Sun controversy first broke out, and that the company had reportedly fired Mr. Ji after confirming this fact. If it is proven true that the manager received his salary from Burning Sun and not Seungri or the agency, Seungri may be charged with embezzlement.
On April 13, YG Entertainment released the following statement:
1. Mr. Ji was Seungri’s manager during the time of his employment with YG Entertainment (he is no longer an employee of the company), and accordingly, his salary was of course paid by our company.
2. As our company has no connection whatsoever to Seungri’s personal business, we had no idea that Mr. Ji was also employed as an overseer at Yuri Holdings or that he had received a separate salary from Seungri’s businesses.
3. We ourselves became aware of these facts only recently, after the controversy broke out, and we terminated Seungri’s exclusive contract and also terminated Mr. Ji’s employment with our company.
Police secure testimony from escort that sexual activity occurred at Seungri's birthday party in Palawan
Police investigating Seungri and his alleged act of mediating prostitution have secured testimony that sexual activity occurred between a female escort and a man at Seungri’s birthday part in Palawan.
According to the Seoul Metropolitan Police Agency’s Provincial Special Detective Division, police secured the testimony while investigating some of the women who attended Seungri’s birthday party in the Philippines. The women, however, stated they had voluntarily entered into such acts with the men and that they were not instructed to do so by anyone else.
Police suspect prostitution may have taken place in exchange for the payment of the escorts’ travel expenses, as Seungri was revealed to have paid for them.
Seungri previously 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.
Seungri held the birthday party in question in December of 2017 and invited a number of friends and foreign investors. On April 7, it was reported that eight professional escorts had also been invited to the party, and police suspected that this was an instance of prostitution mediation as the women were not Seungri’s acquaintances.
The police suspect that even if there were no direct orders from Seungri to provide sexual services, the act of inviting them to the party after paying for their travel expenses was to naturally create an atmosphere for sexual services to be provided to foreign investors.
Meanwhile, in addition to the Palawan birthday party, police are also investigating allegations of Seungri providing prostitution services for a Japanese investor visiting Korea.
Seungri responds to reports accusing him of embezzling Yuri Holdings funds to pay for legal fees of DJ accused of sexual assault
New allegations of embezzlement have been made against Seungri.
On the April 14 broadcast of Channel A’s “News A,” it was reported that Seungri took 10 million won (approximately $8,800) from Yuri Holdings to allegedly pay for the legal fees of a staff member being investigated for suspicions of sexual assault. Yuri Holdings was founded by Seungri and Yoo In Suk in 2016 to operate several businesses in the food and entertainment sectors, which includes the controversial club Burning Sun.
According to the report, Seungri used the money in 2016 for a DJ at the club Monkey Museum, which he established in 2016 in partnership with Yoo In Suk. The DJ was reportedly being investigated for sexually assaulting a woman after she became drunk at the club.
In response, Seungri denied the accusations of embezzlement as he stated, “I paid for the legal fees because it could have affected the club’s image.”
Police are investigating whether Seungri has embezzled funds in addition to the suspected lawyer fees. Prior to this report, Seungri and Yoo In Suk were found to have embezzled funds from Monkey Museum on April 1. The two were booked on the charge of occupational embezzlement.
Sources: Naver (1, 2, 3, 4, 5, 6), MBC News via Soompi (1, 2, 3, 4, 5)
y'all some yg stans caping yg tho, it's just...not it.