Kakao founder faces 15-year prison call in SM share appeal
South Korean prosecutors asked the Seoul High Court on September 23, 2026, to sentence Kakao founder Kim Beom-su to 15 years in prison over alleged manipulation of SM Entertainment's share price.
The request came at the final hearing of Kim's appeal, according to Yonhap News Agency via Reuters. Reuters reported the demand. Music Business Worldwide also carried the report and attributed it to Yonhap via Reuters.
Prosecutors also asked for a fine of KRW 510 million, about USD $377,000, against Kim. They sought confiscation of about 127.2 billion in addition to the prison term.
The demands extended beyond Kim. Prosecutors requested a 12-year prison term for Bae Jae-hyun, Kakao's former chief investment officer. They sought fines of KRW 500 million each against Kakao Corp. and Kakao Entertainment under South Korea's dual punishment rule, which allows both individuals and companies to be penalised for the same offence.
The 15-year term matches what prosecutors sought at Kim's first trial. That trial ended in acquittal. On October 21, 2025, the Seoul Southern District Court cleared Kim, Kakao Corp. and co-defendants. Prosecutors filed their appeal against those acquittals on October 28, 2025.
At the centre of the case is a battle for control of SM Entertainment in February 2023. Kim was indicted over the purchase of around KRW 240 billion of SM shares across 553 transactions that month.
Prosecutors allege those purchases were intended to hold SM's share price above KRW 120,000 per share. That was the price HYBE had offered in its tender offer, a public bid to buy shares from existing shareholders at a set price. Prosecutors say the buying was meant to hinder the competing bidder.
Kim also faces a charge of failing to disclose an 8.16% holding in SM. Prosecutors allege that stake was concealed through private equity firm One Asia Partners.
The case has run for more than two years. A South Korean court approved an arrest warrant for Kim in July 2024 over suspected stock manipulation. At that point, he had not yet been formally charged. Prosecutors later accused him of involvement in manipulating SM's price in 2023 to hinder a competitor.
No verdict in the appeal has been reported. Kim, Bae and the Kakao companies deny wrongdoing under the charges as previously acquitted.
