BharatPe says Ashneer Grover’s family misappropriated funds, created fake vendors

The Grover family and their relatives engaged in extensive misappropriation of company funds, BharatPe said in its first statement after the board meeting on Tuesday.
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Ashneer Grover is no longer an employee, a founder, or a director of Resilient Innovations because of his misdeeds, according to a statement from the company on Wednesday.

Resilient Innovations is the company that runs BharatPe, which was valued at $2.8 billion in August 2021.

“The Grover family and their relatives engaged in extensive misappropriation of company funds,” the BharatPe statement said, “including creating fake vendors, through which they siphoned money away from the company’s account and grossly abused company expense accounts to... fund their lavish lifestyles.”

The BharatPe statement followed the board’s meeting on Tuesday evening to discuss the findings of a governance review of its practices.

Ashneer resigned as Managing Director and board director of BharatPe after getting the agenda of the board meeting.

"Minutes after Mr Ashneer Grover received notice that some of the results of the inquiry would be presented to the board, he quickly shirked responsibility by sending an email to the board submitting his resignation and fabricating another false narrative of the events to the public," BharatPe said in its statement, adding that it strongly objects to Ashneer "spinning lies and hurling baseless allegations and threats".

The BharatPe 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, according to the statement.

"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," the statement added.

On Tuesday, BharatPe said it reserves all rights to take legal action against him and his family. However, BharatPe did not disclose any detailed findings of the report tabled at the board meeting. 

The New Delhi-based fintech unicorn, with its board headed by former SBI chairman Rajnish Kumar, has been engaged in a battle against Ashneer since January. The board had met on Tuesday to discuss the final report of a governance review by independent consultant PwC

The BharatPe board, through its legal firm Shardul Amarchand Mangaldas, had on January 29th appointed advisory firm Alvarez and Marsal to advise the Board on its recommendations.

Ashneer had resigned on March 1 at 12.05 am, minutes after receiving the agenda for the Board meeting that included submission of the PWC report regarding his conduct and considering actions based on it.

"I am being forced to bid adieu to a company, of which I am a founder," Ashneer said in the two-page email he wrote to the company. He maintained that the board will not find a single act of impropriety against him.

"You treat founders as slaves,” Ashneer Grover had lashed out at BharatPe investors

BharatPe said, “the board  will not allow the deplorable conduct of the Grover family to tarnish BharatPe’ s reputation or that of its hardworking employees and world-class technology.”

In his resignation letter, Ashneer said he founded BharatPe and built it up to its enviable position. "No other startup of similar valuation has been able to achieve what BharatPe has achieved today that too by utilising less than Rs 1,000 crore. Clearly, BharatPe’s success story is for the world to see," he said.

Edited by Kunal Talgeri

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