Korea tech tycoon charged in K-pop share rigging case

In a significant development in South Korea's technology sector, Kim Beom-su, the founder of the prominent internet company Kakao, has been charged with stock price manipulation. Known as Brian Kim, he has been in detention since last month. The allegations against him involve the purchase of a substantial number of shares in the K-pop agency SM Entertainment, which prosecutors claim was intended to inflate the stock price and thwart a competing bid for the company. Kakao, in a statement following Kim's arrest, asserted that he did not authorize or condone any illegal activities. The Seoul Southern District Prosecutors' Office has formally indicted Kim, citing violations of financial market regulations. The date for his trial will be determined in the future, according to local news reports. The charges stem from a bidding war that occurred prior to Kakao's acquisition of a nearly 40% stake in SM Entertainment in March of the previous year. Prosecutors allege that Kim engaged in a four-day buying spree of SM Entertainment shares, aiming to elevate its market valuation beyond the reach of rival bidder Hybe, the company behind the globally popular K-pop group BTS. This case has sent shockwaves through South Korea's technology industry, where Kim has long been regarded as a visionary leader. His situation marks a notable moment, as he is the most high-profile tech executive to face imprisonment in South Korea since Lee Jae-yong, the chairman of Samsung Electronics, who served 18 months in prison after being convicted of bribery in 2017. Kim's journey from modest beginnings to becoming a multi-billionaire has made him a beloved figure in a nation where a few family-run conglomerates, known as chaebols, dominate the economy. He is credited with founding and expanding Kakao, which has grown into one of South Korea's most successful internet enterprises. Kakao operates the largest messaging app in the country and has diversified into various online sectors, including gaming, shopping, and banking. In 2022, a fire that damaged Kakao's servers raised concerns about the country's heavy reliance on the services provided by this technology giant. Just hours before Kim's indictment was made public, Kakao reported impressive operating profits of 134 billion won for the second quarter of the year, reflecting an 18. 5% increase compared to the same period last year.