SEOUL, Oct. 30 (Yonhap) — Kakao Corp., the operator of South Korea’s leading mobile messenger KakaoTalk, declared Monday that it will seek methods to reinforce compliance management and internal control in response to allegations of stock manipulation involving its executives.
At an executive meeting, Kakao’s founder Kim Beom-su, CEO Hong Eun-taek, and other executives acknowledged that the corporation is in a “critical” state and will strive to construct a management system that meets “social standards,” according to the company.
“After reflecting on what we have done inadequately in the recent events, I thought we should create a stronger system for ethics management and control both within and outside the company,” Kim said at the meeting.
Kakao has been accused of purportedly boosting the stock price of the K-pop agency SM Entertainment Co. by investing around 240 billion won (US$177.6 million) to win a bidding battle against Hybe Co., the K-pop powerhouse behind global superstar BTS, in February.
Kakao and its subsidiary Kakao Entertainment together acquired a nearly controlling 40 percent stake in the K-pop label with top-tier artists such as NCT and EXO.
Last week, the Financial Supervisory Service (FSS), the financial watchdog, referred Kakao, Kakao Entertainment, and three of the company’s senior executives, including chief investment officer Bae Jae-hyun, who was detained earlier this month, to prosecutors over the claims.
Kim is also suspected of involvement in the case, but the FSS has yet to refer him to the prosecution.
Kakao Corp. founder Kim Beom-su (C) appears for questioning at the headquarters of the Financial Supervisory Service in western Seoul on Oct. 23, 2023. (Yonhap)
nyway@yna.co.kr
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