As the gambling case of YG (and Seungri) continues on, the most recent reveal is that the initial suspicions were brought up by the US Department Of Treasury and that the Korean National Police Agency is requesting their assistance in the records of YG USA, YG Entertainment‘s American subsidiary.
The initial gambling suspicions were brought to light when the United States Department of the Treasury informed financial and investigative authorities in Korea about the fact that Yang Hyun Suk and Seungri had bought casino chips with large sums of money but had no records having wired money from Korea.
No Cut News reported that the Korean National Police Agency made an official request to the United States Department of the Treasury to send over YG Entertainment USA’s (hereafter YG USA) bank account data. This is to check whether Yang Hyun Suk used YG USA’s funds for gambling in Las Vegas.
YG USA was suspicious because it appears to be a paper company.
YG USA is a small corporate body with annual sales of 20 million won (approximately $16,500). However, its subsidiary had annual sales of 2.2 billion won (approximately $1.8 million) and expenses of 2.3 billion won (approximately $1.9 million) with a starting capital of zero won, meaning that it is most likely a paper company (a company that exists solely for financial reasons and has no operations).
As of yet, YG is not being investigated for embezzlement, but those charges could come if YG USA funds were indeed used.
Speaking of which, it was reported by JTBC that YG (going back to the issue with his clubs) received profits in cash.
Yang Hyun Suk ran clubs in Hongdae and Gangnam, but always received the profit in cash, rather than getting it deposited to a bank account. And over the 20 years of operating the club, he was never registered as the owner. An accountant commented, “First of all, he ends up paying less taxes, and there’s now untraceable money. It becomes money that can be used in the political world. Honestly, it’s difficult to get a hold of [large amounts of] cash.”
Police also say they plan on calling in YG and Seungri for investigations next week.
I had thought it was possible that involvement of American authorities was minimal or exaggerated given how it was just thrown in there previously, but if these reports are accurate then it was them who basically red-flagged suspicious activity from YG USA and those financials sure seem to justify the inquiry.