Prosecutors raid K-pop powerhouse Hybe over allegations of fraudulent trading
Prosecutors have raided Hybe Co., a K-pop agency behind global superstar BTS, over allegations of insider trading by one of its executives, judicial sources said Thursday.
According to the sources, the Seoul Southern District Prosecutors Office recently searched Hybe's headquarters in central Seoul to investigate allegations that an executive gained illicit profits worth 240 million won ($176,500) through stock trading using insider information.
The executive, whose identity was withheld, is suspected of purchasing shares of YG Plus Inc., an affiliate of another K-pop powerhouse YG Entertainment, after learning of Hybe's plan to invest in the company.
Separately, Hybe founder and chairman Bang Si-hyuk has also been under police investigation over charges that he intentionally misled investors ahead of the company's initial public offering in 2020. (Yonhap)
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Korea Herald
5 hours ago
- Korea Herald
[Grace Kao] Don't be fooled by celebrity romance scams
The Federal Trade Commission of the US reported that in 2023, consumers lost $1.14 billion to romance scams. This is a substantial increase from $547 million in losses in 2021, and $304 million in 2020. What exactly are romance scams and why are people susceptible to them? Scammers pose as someone who has fallen in love with the victim and is desperately trying to travel to the victim so they can meet. However, one tragedy after another ensues. The scammers work in teams and are grooming multiple victims simultaneously. The carefully designed scripts come in a variety of genres. An extremely interesting variant of this scam involves celebrities. Here, victims believe they are communicating with a celebrity and eventually develop a romantic relationship with them. There are a number of YouTube channels that address this topic. For example, the YouTube channel @catfishedOnline investigates romance scams. Their findings are shared with the victim and often their families, and with the audience. It's tempting to dismiss romance scam victims as gullible individuals who should have known better. However, the pervasiveness of romance scams suggests that criminals are addressing common issues of isolation and loneliness. Victims might be single or married in unsatisfying relationships. Their limited mobility or caregiving responsibilities at home might make it hard for them to meet others. Some may just be socially awkward and have had very few healthy romantic relationships. On this channel, there have been victims that believed that they were in clandestine relationships with Barry Gibb (one of the members of the group Bee Gees), Meta CEO Mark Zuckerberg, actor Johnny Depp and Jennifer Aniston, singer Chris Brown, and comedian Matt Rife. Recently, a fake Jackson Wang (GOT7) made an appearance. Images and information about celebrities are widely available on the internet. Let's say you're a fan of Cha Eun-woo. You can 'like' or 'comment' on one of his photos on social media. Someone named Cha Eun-woo might interact with you in the comments section or direct-message (DM) you. Suddenly, you are chatting with one of your favorite celebrities. This type of contact can happen to any of us who are on social media. I was once friended by an imposter Hyun Bin -- I don't even follow him on any social media nor did I ever comment on any of his content, but I do post information about the Korean Wave. If I was excited to see fake Hyun Bin on my social media, can you imagine what my response might be if 'Jungkook' DM'd me? Once, a fake version of K-pop singer 'Eric Nam' asked me if I was married and if so, was my marriage happy? Yikes. The scammers work to convince victims that they are special. They send them photos and videos of the celebrity with personalized information about the victim added. An image might show your celebrity boyfriend holding a note that says, 'I love you, Grace.' The imposter divulges special secrets about their newest movie or concert. They eventually ask for help because their manager won't let them access their funds. Perhaps they are going through an acrimonious divorce and their assets are frozen. Eventually, they will be in a nearby town for a concert or other activity, so if you want to meet them, you can sign up for a 'meet and greet' which not only costs $1,000 but they also need your name, birthday and social security number -- all the information one needs to open a credit card account. Since you will soon be their partner, why not help them out? In fact, a recent video featured a 70-something year old woman who believed she was engaged to 29-year old Comedian Matt Rife. Over the course of more than a year, she sent him over $100,000. Even after she was provided clear evidence that this was not the actual comedian, she continued to send money. Why did she do this? By sending money, she prolonged the fantasy. In 2024, a North Carolina woman believed she was in a relationship with actor Ahn Hyeo-seop and that they were in love. She was offered the opportunity to meet him, but his 'manager' asked for expenses to arrange a meet and greet, and various other fees. Eventually, she sent him $67,000, more than her life savings. While many victims in the media are women, evidence suggests that there are more male than female ones. According to a November 2022 Javelin survey of 5,000 households, men accounted for 73 percent of the victims of romance scams. In a National Geographic investigation of romance scammers in Nigeria, they confessed that they target men because men were likely to have more money and that they were easier to deceive. So, what's the solution? We should all be in closer contact with our loved ones, especially those who may feel isolated. Also, it's probably safer to talk to your AI boyfriend than your celebrity one, but don't send money to either of them! Grace Kao is an IBM professor of sociology and professor of ethnicity, race and migration at Yale University. The views expressed here are the writer's own. — Ed.
Korea Herald
21 hours ago
- Korea Herald
From Kahi to Yless: How KoreaTech CEO is building next wave of K-beauty
Lee Dong-yeol blends tradition, innovation, indie spirit to redefine K-beauty experience When you step into the flagship Yless store nestled in Seoul's historic Bukchon Hanok Village, you're greeted not just by cutting-edge skincare, but by the aroma of freshly baked bread, the hum of live music and the warmth of Korean hospitality. It's a fitting reflection of the brand's ethos: deeply rooted in tradition, yet boldly innovative. At the forefront is Lee Dong-yeol, founder and CEO of KoreaTech, whose vision is reshaping the K-beauty landscape for a new generation of global consumers. From humble beginnings to beauty innovation KoreaTech's story began in 2003 as a distributor of everyday goods. But Lee's fascination with beauty was always simmering beneath the surface. 'In the early 2000s, I was already passionate about cosmetics. I wanted to try my hand in the beauty space and that led me to ReFa, a beauty device,' he recalls. The company's pivot to beauty devices like ReFa Carat and PAO proved prescient, successfully combining technology with personal care for a rapidly growing market. The real breakthrough came in 2020 with the launch of the Kahi brand. 'Meeting customers face-to-face, I realized their biggest concerns were about basic skincare. I wanted to address the frustrations they felt with existing products and create something truly new,' the CEO said. Introduced as a new type of skincare stick known as the 'multi balm,' Kahi became a runaway success, actively expanding into overseas markets in 2023. The brand surpassed $10 million in exports from July 2023 to June 2024. Kahi is now available on global e-commerce platforms such as Amazon and has entered 11 countries, including the United States and Japan. Birth of Yless: Platform with purpose The journey didn't stop there. December 2023 saw the launch of Yless -- a K-beauty platform designed to challenge industry conventions. 'After selling Kahi both domestically and overseas, I saw that indie brands in Korea were getting great responses, but the competition on platforms was fierce. Too much effort went into chasing trends and marketing rather than product development and quality,' Lee said. With Yless, the CEO set out to change that. 'Our goal is to spotlight brands — not just products — and to introduce truly unique, high-quality items that you won't find anywhere else, offered at prices free from inflated markups. I can confidently say Yless delivers department store quality at ultra-affordable prices.' From day one, Yless was conceived as a global platform. Just a week after launching its app in the US and Japan, international orders began pouring in. 'Japan responded most enthusiastically. At Beautyworld Japan in Tokyo, buyers and consumers were amazed — seeing one company showcase 1,500 products was unprecedented.' In North America, especially among Gen Z, Yless tapped into the rising "dupe" trend — high-quality alternatives to luxury products. 'In the US, buying dupes is considered stylish. Our Bluequatica line of body washes and hand creams, inspired by global luxury fragrances, sold out almost immediately,' he said. Product diversity is another core strength. 'For foundation alone, we offer 40 to 50 shades to cater to the world's wide range of skin tones. That level of customization is rare." Beyond beauty: Building K-culture The Yless flagship store is more than a retail space. 'I wanted it to be a place where people could enjoy the atmosphere of a traditional hanok, experience culture and shop for cosmetics all at once,' the CEO said. The store hosts free live music, offers traditional Korean snacks and even organizes kimchi-making events — last October, employees made 3,000 heads of kimchi, with plans to increase that to 5,000 this year. 'It's about sharing and cooperation — the values at the heart of Korean culture and our brand.' Yless also serves as an incubator for indie brands, partnering with fewer than ten carefully selected companies that share its philosophy. 'It's hard to find partners who prioritize quality over quantity. Like a great restaurant that refuses to become a diluted franchise, we're committed to maintaining excellence,' Lee explained. The CEO is candid about the obstacles small brands face in global markets. 'On platforms like Amazon, competition is so intense that advertising fees can eat up 50 percent of revenue. It's almost impossible for small brands to survive.' Yless' solution is to minimize platform fees and let brands focus on quality, not marketing spend. Much of Yless' momentum comes from its close relationships with top-tier manufacturers. 'Our trust with manufacturers like Cosmax and Kolmar was built during the Kahi project. They supported our bold attempts to create products that didn't exist before, focusing on quality over cost,' Lee said. Fragrance, a notoriously difficult element to perfect, is a point of pride. 'The hardest part always came down to 'scent.' We partnered with a 150-year-old French company in Grasse, the world's perfume capital, to develop our dupe fragrances. They even came to Korea and we bonded over homemade meals,' he said. For Lee, Yless is just getting started. 'My goal is to build a company that lasts a hundred years. This isn't just about creating a retail space — it's about laying the foundation for sustainable global growth,' he emphasized. 'If you make a good product and offer it at a fair price, consumers will recognize its value. Even without heavy marketing, word of mouth continues to drive our growth every day.' The Top 100 Global Innovators series spotlights the trailblazers shaping Korea's future across a range of industries — from bold entrepreneurs and tech pioneers to research leaders — whose innovations are making a global impact beyond Korea. More than a celebration of success, the series offers a deeper exploration of the ideas, breakthroughs and strategies driving their achievements. — Ed. hykim@
Korea Herald
a day ago
- Korea Herald
K-beauty wears US crown — Can it survive tariff test?
A resounding win, but hurdles remain as K-beauty's US lead signals deeper push into mainstream It's now clear that Korean beauty has far outgrown its modest local beginnings. Last year was truly a banner year for the industry, with cosmetics exports surging 20.3 percent to $10.2 billion, ranking third globally behind the US ($11.19 billion) and France ($23.26 billion), according to the Ministry of Food and Drug Safety. Zooming in on US-bound exports last year, Korea's stature continues to rise: The country is not only in the top three in global exports, it ranks first in the world's largest consumer market, eclipsing former leader France. To the top: US breakthrough K-beauty's success formula, rooted in the global K-content wave and lab-based innovation, has worked its magic worldwide, but it's the affordability and e-commerce factors that have propelled K-beauty onto mainstream American shelves. The online retail platform Amazon, unsurprisingly, is the prime stage for K-beauty brands, a gateway essential to nationwide popularity in the US. 'Many leading K-beauty brands have found success entering the US market through Amazon,' noted a Seoul-based cosmetics researcher, adding that their strong sales, fueled by K-beauty's competitive pricing, have only further driven demand. Amazon reported that K-beauty sellers' net sales on its US platform jumped roughly 170 percent on-year last year, with the number of brands climbing to 230, a 1.4-fold increase over the past three years. Success in online sales creates synergies with social media platforms like TikTok and Instagram, where K-beauty builds familiarity and trust with consumers through viral videos. So much so that TikTok's e-commerce channel, TikTok Shop, has become a new space where brands like Medipeel and Anua now hold top spots. Outside the digital realm, Korean beauty has moved into a new phase of visibility, now stocked in major beauty retailers like Sephora and Ulta Beauty, and supermarket chains such as Walmart and Target. Widespread retail contact, however, is not enough to sustain the K-beauty hype if the products fail to deliver on their promised efficacy. 'K-beauty's ascent owes much to its deep understanding of American consumers and its agility in meeting their needs,' explained Kim Ju-duck, professor in the beauty industry department at Sungshin Women's University. 'It has been quick to deliver localized, high-quality products tailored to American preferences and skin types, while putting emphasis on clean formulations that resonate with sustainability-conscious consumers.' Famous examples include TirTir, whose 30-shade cushion compact appealed to a diverse range of skin tones, topping Amazon's US beauty sales last year. In skincare, Medicube has gained popularity for its collagen-boosting properties, while brands such as Cosrx and Anua stand out for star ingredients like snail secretion and heartleaf extract. Driving this growth in part are original design manufacturers, according to Kim, whose advanced development and production capabilities have enabled smaller Korean brands to scale rapidly. This marks a subtle yet profound shift in consumer behavior from brand loyalty to a product-first mindset, one industry observer noted. Regardless of brand size, more consumers, especially younger generations, are weighing product quality and price above all. Korea's top two ODMs, Kolmar Korea and Cosmax, both posted record-high sales last year at 2.45 trillion won and 2.16 trillion won, respectively. Storied brands and contract manufacturers, which handle the bulk of production for smaller K-beauty brands, also remain well-prepared to meet US regulations, including stricter FDA registration, product listing and labeling requirements under the Modernization of Cosmetics Regulation Act. 'We have a dedicated team that monitors US regulations, including MoCRA and the FDA's requirements for over-the-counter drugs like sunscreens, to ensure compliance,' said a Cosmax official. At the top: US hurdles K-beauty's hard-won rise to prominence faces a looming challenge: a delayed 25 percent tariff set to hit on July 8, adding to the minimum 10 percent tariff already in place. In a bid to offset the impact, some firms are leveraging their existing capabilities, while others are eyeing market entry. Kolmar Korea is ramping up its US operations, with a second facility entering pilot operations in the second quarter of this year, complementing its existing factory in Pennsylvania. 'With the Trump administration's tariffs in play, we're seeing a rise in domestic brand inquiries for US-based production," a Kolmar official said. Once the second plant comes online, Kolmar Korea expects its local annual production capacity for sunscreens and basic skincare to nearly double from the current 180 million. Cosmax projected its sunscreen production in Korea and the US will more than triple this year, as four times as many clients plan to enter the US OTC sunscreen market. Cosmax's facility in New Jersey produces around 280 million units annually, accounting for 10 percent of the company's total production. The move coincides with a tariff scare that, in April, sent US consumers into a buying spree for Korean sunscreens prized for their superior UV protection and seamless compatibility with layered makeup. South Korea's top two beauty giants, Amorepacific and LG Household & Health Care, are also stepping up their US operations. LG H&H announced in April a $130 million paid-in capital increase for its North American subsidiary in order to expand its product lineup and boost marketing initiatives. Amorepacific hinted at building its own US manufacturing facilities. In April, CEO Kim Seung-hwan told Bloomberg TV the company plans to invest in US logistics and modular production infrastructure within the next three to five years. Though the tariff situation may seem dire, some industry insiders are more concerned about the strong won against the dollar, which could drive up the prices of Korean imports in the US market. 'Tariffs strike far and wide, not just Korea, and for companies heavily dependent on exports, the won-dollar exchange rate could prove even more critical,' said one insider on condition of anonymity. They went on to describe a new chapter in which technological prowess will shape success in an increasingly personalized and segmented market for years to come: 'In fact, consumers' love for K-beauty is no longer about price alone." K-beauty brands are hardly running behind as they pursue rapid innovation in their products. At this year's CES in January, for instance, beauty powerhouses like Amorepacific, Kolmar Korea and APR showcased next-generation beauty tech, including AI-powered devices, as they charge forward into the tech-infused future.
