Police Raid Starbucks Korea HQ Over Controversial 'Tank Day' Promotion

South Korean law enforcement searched Starbucks Korea’s central offices in Seoul on Wednesday, escalating a severe corporate crisis triggered by a disastrous promotional campaign.

The Seoul Metropolitan Police Agency operation forms part of an ongoing defamation investigation.

Authorities are scrutinizing the coffee chain’s recent marketing efforts, which provoked intense national outrage and high-level political condemnation.

Defamation Investigation

The legal scrutiny centers on a defamation complaint lodged by a local civic group against Chung Yong-jin, chairman of Shinsegae Group.

Shinsegae’s supermarket division, E-Mart Inc., maintains a controlling 67.5 percent stake in the domestic Starbucks franchise.

The complaint alleges that Chung insulted the victims and bereaved families of South Korea’s democracy movement.

Shinsegae acknowledged Wednesday's police operation but declined to provide further specifics.

Singapore’s sovereign wealth fund holds the remaining minority stake in the local franchise.

South Korea represents the coffee brand's largest consumer market outside the United States and China.

Promotional Misstep

The controversy originated in May with the launch of discounted large-size merchandise branded as the “Tank” tumbler collection.

This product rollout aligned precisely with the May 18 anniversary of the 1980 Gwangju uprising.

During that historical event, the ruling military junta deployed armored tanks to suppress civilian protests, resulting in hundreds of casualties.

The timing ignited immediate boycott campaigns and drew sharp criticism from South Korean President Lee Jae Myung.

U.S.-based Starbucks Corp. distanced itself from the domestic strategy, releasing a statement that labeled the promotional effort "unacceptable."

Corporate Overhaul

Facing immense pressure in a highly sensitive market, the franchise terminated its local chief executive officer. Chairman Chung subsequently issued a series of public apologies regarding the incident.

The company also implemented unprecedented operational disruptions to conduct damage control.

Starbucks Korea suspended operations early across its entire network of more than 2,000 retail locations to mandate social-sensitivity and history training for personnel.

The nationwide closure marked the first such shutdown since the brand entered the South Korean market in 1999.

Senior Shinsegae management, including Chung, participated in separate specialized education sessions.