Seoul, April 24 : Prosecutors here said on Friday they have rejected a police request for an arrest warrant for Bang Si-hyuk, chairman and founder of K-pop powerhouse Hybe, who is accused of unfair stock trading, citing insufficient evidence.

The Seoul Southern District Prosecutors' Office sent back to the police the arrest warrant request filed against Bang earlier this week on charges of fraudulent unfair trading under the Capital Markets Act, reports Yonhap news agency.

The chief was suspected of deceiving investors in 2019 into selling their shares in Hybe before the company held an initial public offering (IPO), through which he allegedly pocketed about 260 billion won ($175.28 million) in illegal profits.

"At this stage, there is insufficient evidence to justify the necessity of detention, and we have therefore requested a supplementary investigation," the prosecution said.

Police said they will review whether to reapply for the warrant after conducting further investigation, adding that decisions will be made "in accordance with due process."

The act prohibits obtaining financial gains through false statements or by using deceptive schemes in connection with financial investment products, such as unlisted shares. Violations involving profits exceeding 5 billion won are punishable by life imprisonment or a minimum of five years behind bars.

Bang has denied the allegation, saying the IPO had followed the law and regulations.

Police first received a tip-off on the allegations in late 2024 and raided the Korea Exchange and Hybe's headquarters the following year as part of the probe. Bang was banned in August from leaving the country, leading to various restrictions on his activities.

The U.S. Embassy in Seoul recently sent a letter to the police agency asking that it allow him to travel to the United States to take part in K-pop supergroup BTS' world tour.

/IANS