BharatPe claws back shares of co-founder Ashneer Grover

BharatPe on Tuesday said it has initiated "necessary action" against former co-founder Ashneer Grover to claw back his restricted shares as per the shareholders' agreement.

The Sequoia Capital-backed fintech unicorn says it will take all steps to enforce its right under the law.

The board of BharatPe had sacked Grover from all positions including his title as founder of the fintech firm in March. Grover, the single largest individual shareholder of the company, had tendered his resignation prior to his sacking.

The startup has also terminated the services of several employees who allegedly colluded with vendors and indulged in suspicious transactions to enrich themselves.

"Many vendors involved in malpractices, such as incorrect or inflated invoices, have been blocked for further business with the company. These vendors were also identified during the GST enquiry," the company says in a statement, adding it has already issued legal notices to these vendors to recover the amount and will be filing civil or criminal cases against them in the coming days.

A new comprehensive Vendor Procurement Policy has been developed to ensure that a robust mechanism is in place for onboarding and engaging with vendors, it adds.

This comes months after BharatPe terminated the services of Madhuri Jain Grover, Ashneer's wife and the head of controls at the fintech unicorn, on grounds of misappropriation of funds.

"If required, the company will be filing criminal cases against some of these employees for the misconduct and act of cheating committed by them against the company," says the startup.

In January 2022, the board of BharatPe initiated the corporate governance review of the company. It appointed Alvarez & Marsal (A&M), a global professional services firm known for its work in turnaround management and performance improvement, law firm Shardul Amarchand Mangaldas & Co to help the board and management with its governance review. It also roped in consulting firm PwC to determine "wilful misconduct and gross negligence by a former founder".

After a detailed review of the above report over the last two months, the board of BharatPe has recommended several decisive measures that are being implemented, the company says.

These include a new code of conduct for senior management and employees to strengthen overall governance in the company; a new and comprehensive vendor procurement policy; key personnel appointments including a CHRO and regular internal audits.

A full-time chief human resource officer (CHRO) and an interim chief financial officer (CFO) have joined the company. The startup says it is in the process of finalising the candidate for the role of CFO and the same will be closed in the current quarter.

The board had earlier accused Grover and his family of "extensive misappropriation" of company funds. "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," it had said.