MelOn, the largest music streaming platform in South Korea, is currently being investigated for allegedly not distributing royalties to artists and companies.
According to the authorities, MelOn is charged with the fraudulent use of billions of Korean won in royalties under the name LS Entertainment. LS Entertainment is a non-existent company.
MelOn has stated that they have been investigated before in 2016 and that they do not know the exact details of the investigation.
The claims that MelOn hare not distributing the royalties has been raised in the past, but it is the first time the prosecutors have investigated the streaming company directly. The Cyber Investigation Division seized the offices located in Seoul on May 27, 2019.
The music industry is expected to be massively affected, as MelOn is the largest streaming platform in Korea.
According to The Hankyoreh, the prosecution is investigation MelOn on the allegations that they created a phantom record company back in 2009-2011. After 2011, they are being investigated for the unfair interception of royalties.