BharatPe removes MD Ashneer Grover from all positions for misappropriating funds

BharatPe revealed that Ashneer Grover, his wife Madhuri Jain, and their relatives were engaged in extensive misappropriation of company funds

BharatPe’s management accused co-founder Ashneer Grover and his relatives of engaging in extensive misappropriation of company funds on Wednesday, a day after he resigned as its managing director and board director. The fintech unicorn also stripped him of his founder title.

“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 statement.

“As a result of his misdeeds, Mr. Grover is no longer an employee, a founder, or a director of the company,” BharatPe said. In a post on LinkedIn, Grover hit back at the company’s management.

“I am appalled at the personal nature of the BharatPe Board's statement, but not surprised. It comes from a position of personal hatred and low thinking,” Grover said, adding that “the only thing lavish about me is my dreams and ability to achieve them against all odds through hard work and enterprise.”

Also read: Being forced to bid adieu: Ashneer Grover resigns from BharatPe

In a sign the battle could drag on, BharatPe said it “reserves all rights to take further legal action against him and his family”.

The latest development might be an arm-twisting tactic to force Grover to sell his entire stake in the company at a cheaper price, a corporate governance expert told DH.

India has seen similar boardroom drama before and should consider coming up with rules – akin to those governing listed entities – to regulate startups which cross a certain threshold in terms of funding, said the expert, who did not want to be named.

Grover’s exit capped weeks of drama which started after an audio clip showed him allegedly abusing a Kotak Mahindra bank employee for denying him financing to buy shares in Nykaa’s initial public offering. Grover sought compensation from the bank’s MD, Uday Kotak, for refusing to finance his personal investment and the bank alleged that Grover used foul and threatening language towards its employee.

The startup, which is looking to go public, then roped in independent auditor PWC which submitted its report this week regarding Grover’s conduct.

Grover is still the largest shareholder of the firm which allows digital payments through QR codes. It was founded in 2018 and counts Tiger Global and Sequoia Capital as its backers.

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