Seungri's scandal cost YG 110 billion won in a day — and the contract six weeks later

In February 2019 news of a nightclub scandal broke around Burning Sun, a Seoul club where BIGBANG member Seungri was an in-house director and oversaw publicity. YG Entertainment, his agency, responded on 26 February by saying Seungri had never directly participated in the club's management and had resigned his post there. The market was not convinced: YG shares fell 4.42% that day to 45,400 won.

The verdict arrived in March. On 11 March 2019 YG shares plunged 14% to 37,150 won, and more than 110 billion won of market value evaporated in a single day — the company's market cap fell to 675.6 billion won from 786 billion won the previous Friday. The same day, Seungri announced his retirement from show business. On 13 March YG accepted his request and ended his exclusive contract, apologizing and acknowledging 'its failure to manage (Seungri) in a more thorough manner'.

The damage reached past the agency. Burning Sun closed in 2019, a year after opening. Aori Ramen, promoted as 'Seungri Ramen', saw sales at its outlets nosedive to about half after the scandal, and in July 2019, 26 owners of 15 outlets sued Seungri, the franchiser Aori FNB and its head for a combined 1.5 billion won (about $1.26 million) in compensation. The chain later went bankrupt.

The legal end took two more years. On 12 August 2021 a South Korean military court sentenced Seungri to three years in prison on multiple charges, including prostitution mediation — procuring prostitutes for investors from Taiwan, Japan, Hong Kong and other countries between December 2015 and January 2016 to secure investment for his nightclub and other businesses — and overseas gambling. In March 2025 the Seoul Rehabilitation Court declared the club's corporate shell, Burning Sun Entertainment, bankrupt, with assets of less than 500 million won.