A mirage worth 30 billion won, the downfall of CEO Cha Won of the collapsed entertainment company ‘One Hundred’ > News

The core of this incident is the unreasonable double contract in which CEO Cha Won pledged the intellectual property rights (IP) of his company's artists as collateral. According to the police investigation, CEO Cha collected a large amount of advance payment of 24.2 billion won by proposing an IP utilization business to Nomus Co., Ltd., but in reality, the contract with another company was already in effect. Even though there was no sign of the existing contract ending, he kept it completely hidden and pushed ahead with an additional contract. The fact that advance payment was received even though there were no physical or institutional preparations to properly carry out the business is strong evidence supporting the existence of an intentional act of deception. This strongly supports the suspicion that the company went beyond a simple investment failure and attempted to intentionally defraud the other party to the contract and embezzle funds.

Apart from the IP business fraud charges, CEO Cha's financial transactions in his private area also did not escape the law. He proposed signing a lease contract for a house shared with an acquaintance and received 5.4 billion won as a deposit, but he did not fulfill any of his contractual obligations. This behavior suggests a complete breakdown of the principle of good faith not only in public corporate management but also in personal interpersonal relationships. The police combined these two cases and estimated the total damage to be about 30 billion won, and strongly expressed the need for a detention and investigation after a detailed analysis of the fund flow. This series of processes clearly shows how precarious the management methods of Fiark Group and One Hundred Label, which CEO Cha was running, were walking on thin ice.

When the incident surfaced, CEO Cha immediately announced a strong response. He expressed strong regret that an arrest warrant was applied for while a quasi-appeal was filed claiming procedural illegality during the search and seizure process. Furthermore, he announced his intention to file a complaint with the National Human Rights Commission, alleging human rights violations by the investigation team leader and investigators, and declared an all-out war against the investigative agency. However, this response seems difficult to avoid the cold gaze of public opinion. In a situation where a large number of affiliated artists have already notified contract termination due to non-payment of settlement fees, and some are even filing criminal charges for embezzlement, there is a high risk that an attitude that only emphasizes the legitimacy of the investigation process will be seen as an avoidance of fundamental responsibility.

CEO Cha's downfall is more than just an individual's deviation, it is sounding an alarm about opaque fund management and contract practices within the entertainment industry. At the time of its initial establishment, One Hundred Label attracted attention by co-founding it with singer MC Mong, but its management condition rapidly deteriorated due to suspicions of the management's affair, embezzlement, and rumors related to gambling funds. The fact that the total amount of payments that employees and partners have not received amounts to a total of 10 billion won proves that this company was virtually incapable of normal management. In the end, it is difficult to avoid criticism that the blueprint for a fancy IP business was nothing more than a bait for swindling fund management rather than generating actual profits.