This, amid the police investigation over allegations that he solicited prostitutes for foreign men investing in his business back in 2015. His retirement comes with immediate effect and Seungri will be leaving the band which has sold over 140 million records since their 2006 debut and are known as the "Kings of K-pop".
Seungri, whose real name is Lee Seung-hyun, denied procuring prostitutes last month when a media outlet reported that he had been involved in "sex bribery".
In a statement he apologised to his fans, and promised to "sincerely participate in investigations into all allegations". He is one of five people to make up Big Bang, who are considered showbusiness royalty in the country and many other parts of the world. Prostitution is illegal in South Korea.
"We booked Seungri and changed his status to that of a suspect in order to issue a search and seizure warrant and clear [Seungri] of the suspicions", a police spokesman said at a press conference.
A petition surfaced last week calling for him to step aside after causing "unrecoverable damage to the group's reputation".
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Seungri isn't the first member of Big Bang to be embroiled in controversy, however.
"As I've been branded as a "national traitor", I can not stand the fact that I'm harming others for my own sake", he added.
Rapper T.O.P received a suspended jail sentence in 2017 for smoking marijuana multiple times after he was hospitalised for a drug overdose.
"I give my heartfelt, honest thanks to fans at home and overseas who gave their love for the past 10 years, and I think this should be it for the sake of the reputation of YG and Big Bang".
Seungri is starting his two-year mandatory military service from March 25, according to Yonhap.