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Days after BharatPe’s former MD and co-founder Ashneer Grover’s resignation, the fintech firm fired a fresh salvo at him alleging that the Grover family engaged in massive misappropriation of company funds, and BharatPe reserved all rights to take legal action against him and his family.
In response Ashneer Grover, said he was “appalled” at the personal nature of the company’s statement, but not surprised.
“It (the company’s statement) comes from a position of personal hatred and low thinking. I think the Board needs to be reminded of $1 million of secondary shares investors bought from me in Series C, $2.5 million in Series D and $8.5 million in Series E. I would also want to learn who among Amarchand, PWC and A&M has started doing audit on ‘lavishness’ of one’s lifestyle,” said Grover in a statement.
BharatPe had alleged in the statement: “The Grover family and their relatives engaged in extensive misappropriation of company funds, including, but not limited to, creating fake vendors through which they siphoned money away from the company’s expense account and grossly abused company expense accounts in order to enrich themselves and fund their lavish lifestyles.”
Responding to this specific charge, Grover said: “The only thing lavish about me is my dreams and ability to achieve them against all odds through hard work and enterprise. I hope the Board can get back to working soon - I as a shareholder am worried about the value destruction. I wish the Company and the Board a speedy recovery.”
The latest round of accusations and rebuttals follows Grover’s February 28, 2002 midnight resignation. Grover resigned from the company saying that he is being “forced to bid adieu to a company of which he is a founder.”
BharatPe’s statement noted that as a result of his misdeeds, Grover is no longer “an employee, a founder, or a director of the company.” The company did not comment on whether the board decided to accept Grover’s resignation or terminated him. However, a source close to the development told BusinessLine that the final decision on a legal action will be taken once all the reports of the review are out. The company held a board meeting on March 1 to discuss the PWC report regarding Grover’s conduct.
On January 29, 2022, BharatPe’s board had announced that they are conducting an independent audit of the company’s internal processes and systems and had appointed Alvarez & Marsal to advise the board on its recommendations. The report is expected to come in this week.
“The company has taken strong objection to Mr. Grover spinning lies and hurling baseless allegations and threats. The Grover family and their relatives engaged in extensive misappropriation of company funds, including, but not limited to, creating fake vendors through which they siphoned money away from the company’s expense account and grossly abused company expense accounts in order to enrich themselves and fund their lavish lifestyles,” BharatPe said in a media statement.
The statement added that as a result of his “misdeeds”, Grover is no longer “an employee, a founder, or a director of the company.” The company did not comment on whether the board decided to accept Grover’s resignation or terminated him. However, he continues to hold his 9.5 per cent stake in the company. Matters pertaining to Grover’s shareholding will be handled in accordance with the company’s article of association, according to BharatPe.
BharatPe also said that Grover sent his resignation minutes after receiving the agenda for an upcoming board meeting that would entail submission of PWC report regarding Grover’s conduct and considering action on it. The company alleged that Grover shirked responsibility by sending an email to the board submitting his resignation and fabricating another false narrative of the events to the public.
Last week, the Singapore International Arbitration Centre (SIAC) rejected Grover’s plea to stop the governance review and said that it was premature for it to give any conclusive decision making as the governance review is still not finalised. Earlier on February 22, BharatPe terminated Ashneer Grover’s wife and company’s head of controls Madhuri Jain because of the “financial irregularities” found by the company. According to sources, Jain’s termination featured examples of her using the company’s money for personal expenses, wellness and skin treatment, among other things.
Further, BharatPe added in its statement, “The board remains highly focused on supporting the growth and continued success of the company. 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. The success of BharatPe is a result of the collective effort of a large team of dedicated and talented professionals, and not any one individual. We are confident that the company is marking the beginning of a new chapter in its success–one grounded in trust and integrity–and we are excited to embark upon this next leg of our journey.”
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