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SM Entertainment Founder Lee Soo Man Denies Buying $4.8 Million Malibu Estate With Unreported Tax Income

By Jesse Lent | March 31, 2014 04:57 PM EDT

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SM Entertainment founder Lee Soo Man denied a Korean Broadcasting System news report on Thursday claiming that in addition to his K-pop record label being investigated for tax evasion, as previously reported, he personally is being targeted for his mansion in Malibu, Calif., allegedly purchased with unreported tax income.

Lee, who reportedly hid the earnings from pop stars on the SM Entertainment roster in a series of paper companies overseas, allegedly used the Hong Kong based company Polex Development Limited as a tax shelter to purchase a $4.8 million mansion in Los Angeles.

But in an official statement, a representative for the K-pop record label mogul claimed that the real estate transaction was completely above board.

"When Lee Soo Man and Polex Development acquired the real estate in Malibu in April of 2007, Mr. Lee followed the legal procedure and completed the report of overseas real estate acquisition," the statement read, according to the website allkpop.

"Even after he sold this real estate, he followed the determined process and reported this overseas real estate sale."

"In relation to the relevant acquisition period and funding, Mr. Lee reported the truth about this acquisition to the Korean foreign exchange and taxation authorities and went through the lawful procedure to transfer money for this acquisition," the rep's statement added.

"The report claiming Lee Soo Man exported his wealth overseas through illegal methods is not true and this is a rather unfortunate event."

In addition to the mansion he purchased with Polex development, Lee reportedly has $2.8 million of real estate in Malibu and the Los Angeles neighborhood known as Koreatown.

Tagged :  SM Entertainment, Lee Soo Man

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