Kakao Tech Tycoon Charged Over Alleged Stock Price Manipulation
Kakao tech tycoon Kim Beom-su has been charged with stock price manipulation. Kakao has exhibited robust financial health. The company reported an operating profit of 134 billion won in the second quarter, an 18.5% increase compared to the previous year.
Kim Beom-su’s story from modest beginnings to becoming a billionaire is well-known. In South Korea, where large family-owned conglomerates, known as chaebols, predominate, Kim is seen as an entrepreneurial beacon. His role in transforming Kakao into a leading internet firm—covering messaging, gaming, e-commerce and finance—highlights his pivotal influence in the industry.
According to local news, Kim Beom-su , widely recognized as Brian Kim, has been charged with stock price manipulation. Kim is the founder of Kakao, a major entity in South Korea’s tech industry. He has been detained for more than two weeks, under allegations of inflating SM Entertainment’s share prices to sabotage a rival bid.
The Seoul Southern District Prosecutors’ Office has accused Kim of executing substantial stock purchases of SM Entertainment. This strategic buy was allegedly aimed at inflating the stock’s market value to block a competing bid from Hybe, the company behind K-pop sensation BTS. The charges have presented Kim with a formidable legal obstacle, potentially impacting his revered status in South Korea’s tech landscape.
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Kakao has issued a categorical denial of any wrongdoing by Kim, asserting that he did not authorise or partake in any illegal activities. The trial date remains undetermined, with local reports suggesting it will be decided in due time.
Kim said: “I believe the truth will eventually be revealed, because I have never instructed or condoned any illegal acts.”
This case arises in the context of Kakao’s aggressive acquisition strategy, gaining nearly 40% of SM Entertainment shares in March last year. This move was preceded by an intense bidding war. The legal ramifications of this manoeuvre have sent ripples through the tech industry, stressing out Kim’s significant influence and the extensive reach of Kakao.
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