BharatPe Co-Founder and Managing Director Ashneer Grover, has resigned from BharatPe.
“I write this with a heavy heart as today I am being forced to bid adieu to a company of which I am a founder," Grover wrote in his resignation email, according to Moneycontrol.
In a letter sent to the Board, he said that he is being forced to bid adieu to a company of which "I am a founder...Your views of businesses and problems on the ground are so coloured by the windows of the Ivory Tower in which you all reside that you have no connect whatsoever with the human element of the business. It is sad that you have even lost touch with the Founder. You've lost touch with me," he wrote in the letter, IANS said.
He said in the letter that for the board of directors, "the Founder of this company has been reduced to a button to be pressed when needed".
"I cease to be a human for you. Today, you have chosen to believe gossip and rumours about me instead of having a frank conversation. You are so easily spooked because you have no touch with reality," he argued.
Loses artbitration
Grover resigned a few days after he lost an arbitration that he had filed against the company’s investigation against him, with an emergency arbitrator holding that there was no ground to stop governance review at the fintech firm, sources said.
The emergency arbitrator (EA) has, however, rejected all the five grounds of his appeal and denied a single relief, sources with direct knowledge of the development said.
Grover had pleaded before the arbitrator that the preliminary investigation was invalid because it was in violation of shareholder agreement and articles of association and the company has no authority to conduct such an investigation.
He had termed all appointments for the independent audit of the company's internal processes and systems as bad in law. He had alleged that the members of the committee reviewing governance processes, such as company CEO Suhail Sameer and the company's general counsel Sumeet Singh, seemed to be biased.
Also, ''the appointment of Suhail Sameer as a director be kept in abeyance, and he be restrained from discharging any functions as director of the company'', Grover had said in the plea which also sought that no action be taken against him.
Sources told PTI that the EA rejected all the five grounds of relief. On the claim of bias, the EA said that Grover's claim did not seem reliable or credible because until week back both Suhail and Sumeet were among the best employees and everything was great about them.
Also, everything the company has done is as per law and governance norms so there is no need to change anything, the EA noted, outrightly rejecting all contentions and giving no relief to Grover. Grover can challenge the arbitrator's order before the Delhi High Court, sources said.
In his plea, Grover alleged that despite numerous representations/ objections, BharatPe deliberately kept the review and assessment by the review committee an opaque process and gave him no chance to present his case.
The first hearing on the arbitration happened on February 20 and the EA passed the order a couple of days back, the sources said.
Grover was represented by Karanjawala & Co, while BharatPe was represented by senior counsel Abhishek Singhvi. In statements this month, Grover called for removal of Sameer.
Grover goes on leave
Grover, who last month went on a two-month leave of absence following allegations of using abusive language against Kotak Mahindra Bank staff and fraudulent practices, had filed an arbitration plea with the Singapore International Arbitration Centre (SIAC) claiming the company's investigation against him was illegal.
What is the issue?
A preliminary internal investigation has pegged the magnitude of the financial misconduct at over Rs 50 crore. BharatPe has engaged a law firm and risk advisory consultant to conduct a more detailed investigation after allegations of financial irregularities, sources said.
PricewaterhouseCoopers (PwC) alongside Alvarez & Marsal (A&M) are doing the audit.
That review threw up alleged misuse of funds by Madhuri Jain, head of controls at BharatPe and wife of Grover. Jain, who helmed procurement, finance and human resources from the company's early days, was fired following the review.
Developments around its controversial founder have been snowballing at BharatPe ever since the emergence of an audio clip in which Grover is allegedly heard threatening an employee of Kotak Wealth Management over his failure to secure financing for Nykaa's initial share sale.
On January 19, Grover was sent on voluntary leave of absence for two months till March-end.
Ashneer Grover's wife Madhuri Jain sacked
BharatPe sacked Madhuri Jain Grover, wife of Ashneer Grover, over alleged financial irregularities and cancelled ESOPs vested with her.
Jain Grover is alleged to have used company funds for personal beauty treatments, buying electronic items and family trips to the US and Dubai, sources with direct knowledge of the matter said.
Besides, she also allegedly paid her personal staff out of company accounts and produced fake invoices from known/friendly parties, they added.
Sources said that review found that Madhuri Grover allegedly shared confidential information that was used by her father and brother to create and raise invoices on the company under the camouflage of certain third parties.
She is alleged to have billed the company for personal expenses including those towards 'laser genesis and clearlift' face treatment in April 2021 as well as televisions (a LED TV and a Sony Bravia 65-inch) and a fridge for her residence.
Other allegations against her include US and Dubai trip for family members being charged back to the company, inflated purchases of marketing and branding products, fake quotes procured from friendly parties and salary of main and personal staff being paid from the company.
All the bills were approved by her, they said.
She was financial in-charge of the company since October 2018.
While an email sent to Jain Grover for comments remained unanswered, a company spokesperson confirmed the termination, PTI said.
Stock options vested with Jain Grover cancelled
Stock options vested with Jain Grover have also been cancelled, BharatPe said, adding the alleged financial irregularities have been detailed in the termination letter.
Her husband, Ashneer Grover was sent on a three-month leave following allegations of using abusive language against Kotak Mahindra Bank staff and fraudulent practices. He denied all allegations.
Jain Grover was last month sent on leave within days of her husband announcing a three-month leave of absence following allegations of using abusive language against Kotak Mahindra Bank staff and fraudulent practices.
(With inputs from Agencies)
