BharatPe accuses Ashneer Grover, family of fraud; strips 'founder' title
What's the story
Fintech unicorn BharatPe has accused co-founder Ashneer Grover and his family of "extensive misappropriation of company funds." In a statement on Wednesday, BharatPe said Grover is "no longer an employee, a founder, or a director of the company" due to his misdeeds. The company said Grover's resignation on Tuesday was an attempt to "shirk responsibility" and "fabricate another false narrative."
Context
Why does this story matter?
Shark Tank The spat between Grover and BharatPe assumes significance due to the nature of the grave allegations of fraud against the entrepreneur. BharatPe is a prominent Indian unicorn start-up and it was last valued at $3 billion in 2021. Grover—now known widely as a "shark" on Shark Tank India—has leveled cross allegations of being targeted, impacting the company's reputation.
Statement
Grover resigned after notice from Board: BharatPe
BharatPe said its Board directed a review of the company's internal controls involving risk advisory firm Alvarez & Marsal, consulting firm PwC, and law firm Shardul Amarchand Mangaldas and Co. Minutes after Grover received a notice that some of the inquiry's results would be shared with the Board, he sent an email to the Board tendering his resignation, BharatPe said.
Allegations
Grover, family 'created fake vendors to siphon money'
BharatPe said the Grover family and their relatives engaged in extensive misappropriation of company funds. The Grovers created "fake vendors through which they siphoned money away from the company's account," BharatPe said. They "grossly abused company expense accounts in order to enrich themselves and fund their lavish lifestyles," it added. BharatPe acknowledged its "strong objection" to Grover's lies, "baseless allegations, and threats."
Quote
BharatPe to strengthen company's governance
"The Board is taking all necessary steps to further strengthen the company's corporate governance, including the appointment of an audit committee, an internal auditor, and the implementation of other key internal controls," BharatPe further said. It said the company is "marking the beginning of a new chapter in its success - one grounded in trust and integrity."
Recent news
Grover resigned yesterday, week after wife's sacking
Grover had tendered his resignation as BharatPe's managing director on Tuesday saying the company has chosen to believe "gossip and rumors." The company is "so far removed from reality" that it has forgotten how real businesses look. Last week, BharatPe had sacked Madhuri Jain as the head of controls. She was accused of siphoning money from the company and funds misappropriation.
Information
Grover's actions reportedly landed company in soup
Earlier, BharatPe had reportedly decided to remove Grover over allegations of GST evasion and other financial irregularities. The company had faced raids by the Directorate General of GST Intelligence and had to pay Rs. 11 crore due to this misconduct.