ADOR accuses HYBE of conducting coercive audit on style team director

ADOR, a subsidiary of HYBE, alleges that HYBE conducted a coercive audit on ADOR’s style team director regarding embezzlement that lasted past midnight on Friday.

HYBE's headquarters in Yongsan District, central Seoul [NEWS1]

ADOR, a subsidiary of HYBE, alleges that HYBE conducted a coercive audit on ADOR’s style team director regarding embezzlement that lasted past midnight on Friday. This latest development coincides with the announcement of the impending D-day for ADOR’s shareholders meeting scheduled for May 31.

ADOR claims that HYBE’s audit team initiated an audit on ADOR’s style team director at 7 p.m. on Thursday — well past work hours, ADOR pointed out — that continued for five hours. The team then followed the director to her home to acquire her personal laptop and phone.

“The audit goes beyond the professional boundaries,” ADOR said in a statement. “How this audit was conducted constitutes illegal practices such as obstruction of duties, coercion, and invasion of privacy,” adding that the audit dragged on even though the director informed the audit team that she had an early schedule in the morning.

The audit is focused on investigating whether members of ADOR’s style team engaged in embezzlement of funds from advertisers. Moreover, ADOR CEO Min Hee-jin was aware of these circumstances but chose not to intervene.

The norm within the local advertising industry is that freelancers are hired to style celebrities during photo shoots, and separate payment contracts are drawn between advertisers and freelancers. On the other hand, ADOR formed a separate style team internally to ensure consistent quality, flexibility in the artists’ schedule changes and protection of artists’ privacy.

The team members continued to receive separate fees from advertisers, and ADOR factored this amount into the incentives it calculated for these employees.

HYBE swiftly responded to ADOR’s statement, asserting that the director admitted to receiving millions of won in cash benefits from external contractors over several years.

“There is no industry practice where a company’s employees directly receive millions of won in profits from advertisers,” HYBE said. “The amount should have been recognized as company revenue, but Min Hee-jin, as the CEO, has allowed this to go on for several years without taking any subsequent measures such as recovering or penalizing the illegal cash.”

HYBE added that the audit began at a late hour because the director came into the office at 6 p.m. on Thursday. The audit team only followed the director to her home because she expressed her willingness to cooperate and submit her personal laptop as evidence. HYBE also requested her personal phone because Min and ADOR members used KakaoTalk for communication instead of the company’s internal messenger.

“We are regretful that this statement was issued based on false information, which attempts to deceive the public once again to stand from Min Hee-jin’s side,” HYBE said. “This is a serious defamation against the company.”

BY LEE JAE-LIM [lee.jaelim@joongang.co.kr]