Following the legal battle between artist Lee Seung Gi and HOOK Entertainment‘s CEO Kwon Jin Young over decades of unpaid work, Dispatch has shared another round of shocking revelations.
In an exclusive headlined “The Truth Behind HOOK Entertainment Hooking Lee Sun Hee’s Family Up With Lee Seung Gi’s Earnings,” Dispatch exposed CEO Kwon Jin Young for exploiting up to 3% of the earnings brought in by not only Lee Seung Gi but also actors Youn Yuh Jung, Lee Seo Jin, and Park Min Young.
In January 2011, Lee Seung Gi signed an endorsement for an outdoor fashion brand. He agreed to a guarantee of ₩500 million KRW (about $391,000 USD). But how much did he actually make from shooting the commercial?
Ten percent of the earnings were excluded as “agency fees,” which came out to be ₩50.0 million KRW (about $39,100 USD). This meant the commercial resulted in ₩450 million KRW (about $352,000 USD) in revenue. Per his contract, Lee Seung Gi split this 4:6 with HOOK Entertainment, him being the 40%. So, in total, he made ₩180 million KRW (about $141,000 USD) while HOOK Entertainment made ₩270 million KRW (about $211,000 USD).
However, the said “agency fees” were revealed to be only seven percent. Dispatch claimed that three percent of the fees, which Lee Seung Gi paid, went “into someone else’s pockets.”
Dispatch was able to obtain the payment details for HOOK Entertainment’s commercial contracts. The obtained information included receipts for Lee Seung Gi, Lee Seo Jin, Youn Yuh Jung, Park Min Young, and other managing artists’ earnings from commercial deals.
Money Gone Missing
On December 22, Lee Seung Gi’s legal team made a public statement about HOOK Entertainment having overcharged agency fees.
…we found out through a recent tip-off that the current and previous directors of HOOK Entertainment had fooled Lee Seung Gi and embezzled a portion of his fees as a commercial model. He thought that about 10% of his model guarantee was provided to the advertisement agency as “fees,” but in truth, the previous and current directors had shared a portion amongst themselves instead…
— Lee Seung Gi’s Legal Team
Dispatch confirmed that Lee Seung Gi’s contract with HOOK Entertainment stated, “The artist shall be responsible for all fees for agencies, brokers, and partners,” and, per contract, HOOK Entertainment charged him 10% in fees. However, Dispatch also discovered that HOOK Entertainment paid the involved agencies, etc. only 7% in fees.
So where did the remaining 3% go? As Lee Seung Gi’s legal team claimed, the “portion” had been “shared amongst themselves instead.” The artists had been exploited.
Where Did The 3% Go?
Tracking the receipts, Dispatch uncovered that the missing 3% of the fees were split between HOOK Entertainments previous and current Executive A, Executive B, Executive C, as well as CEO Kwon Jin Young’s Friend D and Friend E, and Lee Seung Gi’s “mentor” Lee Sun Hee’s Family Member F.
HOOK Entertainment’s Contract With Lee Seung Gi
“The artist shall be responsible for all fees for agencies, brokers, and partners. HOOK Entertainment shall calculate earnings based on the remaining balance after the fees have been paid.”
Agency Fees Dropped From 10% To 7% In 2010
HOOK Entertainment was charged only 7% in agency fees starting in 2010.
CEO Kwon Jin Young And Executives A, B, C Join Scheme
“Let’s not tell Lee Seung Gi about the 3% drop in fees!”
The 3% Overcharged Fees Exploitation From 2010 To 2022
Executive A, Executive B, Executive C, CEO Kwon Jin Young’s Friend D, Friend E, and Lee Sun Hee’s Family Member F pocketed the overcharged fees.
HOOK Entertainment “embezzled” the fees in various methods. Some were taken out of Lee Seung Gi’s bank account. Some were excluded from deposits being made to the artist. All were labeled as “agency fees.”
Even when there wasn’t an agency involved in commercial deals, like Lee Seung Gi’s 2010 advertisement for a financial institution, HOOK Entertainment charged 10% fees—and pocketed all. Lee Seung Gi was offered ₩200 million KRW (about $156,000 USD) for the said 2010 commercial; HOOK Entertainment took ₩20.0 million KRW (about $15,600 USD) in fees and split the money between Executive A, Executive B, and Executive C.
Who Are These People?
According to Dispatch, CEO Kwon Jin Young decided who would receive shares of the 3% each time the “fees” occurred. Back in 2010, the secret “Three Percent Group” was founded. Until 2019, HOOK Entertainment’s Executive A, Executive B, and former Executive C each pocketed 1% from the overcharged 3%.
In November 2019, Executive C was removed from the group while Friend D was introduced. Identified as CEO Kwon Jin Young’s high school friend, Friend D received 1% of the overcharged 3%—alongside Executive A and Executive B—until October 2020.
Then, in November 2020, vocalist Lee Sun Hee’s Family Member F (who has no business ties with HOOK Entertainment) was added to the group in Friend D’s place. Executive A, Executive B, and Family Member F each took 1% of the overcharged 3% until March 2022.
In June 2022, CEO Kwon Jin Young’s Friend E replaced Family Member F, forming a new “Three Percent Group.” Friend E, who is said to be helping CEO Kwon Jin Young as of late, was identified in related exposés as the former Louis Vuitton employee.
Who Else Got Overcharged By HOOK Entertainment?
Did HOOK Entertainment overcharge anyone else in fees? Yes. Signed actors Youn Yuh Jung, Lee Seo Jin, and Park Min Young all paid 10% in “agency fees.” For all three actors, too, HOOK Entertainment passed only 7% of the fees to the agencies and pocketed the remaining 3%.
One percent of the earnings from Youn Yuh Jung’s furniture brand endorsement went to Lee Sun Hee’s Family Member F. One percent of the earnings from Park Min Young’s massage equipment endorsement went to CEO Kwon Jin Young’s Friend E. Were these actors aware that HOOK Entertainment is charging them 3% extra in fees? Or were they completely blindsided like Lee Seung Gi was, too?
Based on calculations, Executive A has pocketed at least ₩600 million KRW (about $469,000 USD) from their 1% “share” of the 3%. Executive B and Executive C have gained about ₩400 million KRW (about $313,000 USD) each. CEO Kwon Jin Young’s Friend D has taken about ₩50.0 million KRW (about $39,100 USD) while Lee Sun Hee’s Family Member F has made about ₩130 million KRW (about $102,000 USD).
In total, the six people involved have exploited up to ₩1.80 billion KRW (about $1.41 million USD) from HOOK Entertainment’s managing artists.
Though Executives A, B, and C could argue that the 1% shares were “incentives” for their involvement in making the commercial deals happen, Dispatch questioned if—legally—the artists should have been the ones paying. As for Friends D, E, and Family Member F, Dispatch concluded “Undeniable embezzlement.”
This content was originally published here.
