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Current Affairs

Ashneer Grover controversy

Date: 14 February 2022 Tags: Miscellaneous

Issue

Ashneer Grover, the co-founder of BharatPe has demanded Rs 4,000 crore from the company if they want him to exit.

 

Background

Ashneer Grover and his wife have been accused of allegedly inflating transactions by using fake vendors.

 

Details

Sequoia Capital India, Coatue Management and Ribbit Capital are the three largest stakeholders in the company.

 

Start of issue

  • The controversy started after a leaked audio contained Grover hurling abuses at Kotak Mahindra Bank employee for missing out on the IPO allotment for Nykaa.

  • There was criticism aimed at Grover for driving toxic work culture in the firm that led to exit of top-level talents.

  • Grover also had a spat with a high level official at Sequoia Capital India for not committing fund for BharatPe’s Series B round.

 

Latest controversy

  • Grover and his wife went on a leave after the firm decided to conduct an independent audit following a controversy in media.

  • BharatPe was accused of routing money through fake HR consultant firms that were linked to his brother-in-law.

  • There were fake transactions to merchants. Illegal ‘payments’ were made to consulting firms and vendors. The company incurred a loss of 10 crore.

  • The firm paid fees to consultation firms for bringing new employees on board, who say that they were hired without the support of consultation firm.

  • Some fake vendors who were given money had similar address, email id and also banks. Majority of the invoice was forwarded by Grover’s wife.

 

Way ahead

  • Grover and his wife may be permanently removed by the board if they are implicated by at least four audit firms.

  • The company is negotiating to buy back the shares of Grover, which is about 9.5%. The negotiations are aimed at calculating the total worth of the shares.