Shares of Artist United, a company where actor Lee Jung Jae is the largest shareholder, plummeted over 20%, sparking panic among individual investors. The sharp decline follows allegations of insider trading linked to the company, formerly known as Widerplanet.

As of 11:11 a.m. on December 6, Artist United's stock traded at 13,270 KRW (approximately $9.34), a 21.62% drop from the previous day. At one point, the stock hit the lower limit of 11,860 KRW (around $8.35). The sell-off appears to have been triggered by news reports indicating that financial authorities are investigating alleged insider trading activities associated with the company.

According to media reports, a group of individuals allegedly anticipated Lee Jung Jae and fellow actor Jung Woo Sung's acquisition of Artist United. They reportedly manipulated the stock, labeling it a political-themed stock, to inflate its value and profit from the rise. Authorities suspect these individuals intentionally boosted the stock price for financial gain and are currently examining the details.

Through its statement, Artist United denied any wrongdoing on the part of Lee Jung Jae, clarifying that he is involved only as a witness in the investigation. The company emphasized that neither Lee nor his management agency, Artist Company, is linked to illegal activities such as insider trading or information leaks during Widerplanet's third-party allotment of paid-in capital increase.

"While it's true that the former Widerplanet (now Artist United) is under investigation by financial authorities, Lee Jung Jae and Artist Company are not subjects of the probe. We will actively cooperate to clear any misunderstandings," Artist Company stated. The company also vowed to take strict legal action against any parties involved in insider trading or information leaks to protect its shareholders.

Artist United specializes in big data and AI-driven marketing platforms. Established in 2010, it was listed on the KOSDAQ market in February 2011. In December last year, Lee Jung Jae and Jung Woo Sung acquired a controlling stake in the company through a third-party capital increase. The company's name was changed to Artist United in March 2023 and merged with Artist Company in November. The insider trading allegations date back to Widerplanet's capital increase announcement last year when a stock price and trading volume spike fueled suspicions.

Despite the ongoing controversy, Artist United has pledged to conduct its investigation and hold any wrongdoers accountable, aiming to mitigate damage to shareholders.

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