SUMMARY
Auditing firm Alvarez & Marsal found fraudulent transactions and alleged instances of BharatPe routing money through fake HR consultant firms
BharatPe was said to be paying recruitment fees to a number of ‘consultants’ to recruit employees, but these employees were never recruited through these consultants
Madhuri Jain Grover is said to have directly been involved with faking the invoices from the vendors and forwarding them to the accounts team
Fintech giant BharatPe continues to draw attention for its ongoing boardroom drama. In the continuity of the mudslinging acts, the startup has filed a case of Section 420 against Madhuri Jain Grover, its former head of controls.
Under the said section, the wife of former BharatPe MD Ashneer Grover has been accused of cheating and dishonestly (inducing the delivery of property). The maximum punishment for the offence is imprisonment for up to seven years and a fine.
The matter will be heard by the Delhi High Court on Thursday (November 8, 2022).
The case comes months after Jain and her family members were accused of creating financial irregularities at BharatPe. Auditing firm Alvarez & Marsal’s preliminary inquiry found fraudulent transactions and alleged instances of BharatPe routing money through fake HR consultant firms to Jain’s brother Shwetank Jain. The BharatPe Board accused the head of control, Madhuri Jain Grover of the transactions, alleging embezzlement.
According to the inquiry, the fintech firm was said to be paying recruitment fees to a number of ‘consultants’ to hire employees. In five such cases, employees have confirmed their joining dates as the one mentioned in the vendor invoice but they had no knowledge of being recruited or engaged through the said ‘consultants.’
In three out of those five instances, Madhuri Jain Grover is said to have directly received the invoices from the vendors and forwarded them to the BharatPe accounts team for payment; hence she has been charged with ‘misappropriation of funds’.
Later, Jain Grover took a voluntary leave of absence from the company. She later wrote to the company alleging that she never actually tendered her resignation, hinting that the Board ousted her. She could also lose her equity, per her employment contract.
In addition, A&M also investigated the acquisition of the multi-brand loyalty platform Payback India where there was an alleged conflict of interest. According to reports, Payback’s leadership team and Grover were former American Express executives and the deal was overvalued and green-lit by the company Board.
Furthermore, investigations are also underway into every other aspect of the startup including marketing spending and other financial transactions.
Later, in continued acts of retaliation, Jain, who headed the controls department at the fintech unicorn, dredged up videos of people partying inside the BharatPe offices, accusing them of objectifying women.
