Yang was also suspected of having 10 prostitutes travel abroad with him in October 2014 to offer sex services for foreign investors.

Police investigators have looked into records of Yang's financial transactions and communications and questioned the concerned prostitutes but failed to uncover any objective evidence to back up the suspicions of pimping, the officials said.

"There have not been testimonies about sex services for the foreign businessman at a Seoul restaurant in 2014. 

In case of overseas trip in the same year, some women who accompanied Yang offered sex services but it was difficult to conclude their act was prostitution," a police official said.

Yang resigned from the top post at YG Entertainment in June as its big-name artists were embroiled in a series of scandals, including alleged drug use.

Despite being cleared from the pimping charges, Yang is still under police investigations about allegations that he engaged in habitual gambling abroad and violated foreign exchange laws to secure gambling money. 

He underwent overnight questioning as a criminal suspect at the Seoul Metropolitan Police Agency's Intellectual Crime Investigation Team last month, together with Seungri, a former member of the K-pop boy band BIGBANG.

Yang has also been under suspicion that he threatened or coerced people related to the drug allegations involving B.I., former songwriting leader of K-pop boy band iKON. (Yonhap)