Thread by @myfinology

A new "bad boy" in the Industry : BharatPe's #ashneergrover 🤠

A popular face of social media after his appearance as a panelist in #SharkTankIndia, Grover is in d limelight, but this time “it’s -ve publicity”!

Read d complete thread to know "What's the buzz all about?"

(1/17)

It all started on 5th Jan, when a call recording leaked into the public resulting in exposing an ugly side of the Shark.📞

Grover was found bashing an employee of Kotak Mahindra Bank for failing to gain a share of allocation for Nykaa’s IPO.

(2/17)

Grover claimed that the audio clip was “fake” but soon after this, Kotak issued a statement stating that the bank is pursuing “appropriate legal action” against BharatPe’s MD, Ashneer Grover, for the “inappropriate language” used in the call.

#AshneerGrovervsKotak

(3/17)

The drama got another twist when Grover took a voluntary leave of absence on Jan 19th.

Soon after a week, his wife, Madhuri Jain Grover, Head of Controls at Bharat Pe was also sent on leave which signaled a bigger problems surrounding the BOD and the founder.

(4/17)

Whether the clipping is to be blamed or not, Grover’s conduct became a matter of public scrutiny and BharatPe had to announce an independent audit of its internal processes.

A serious concern was Grover’s stranglehold on the company.

(5/17)

As per sources, Grover and his wife, Madhuri Jain, a fashion designer-turned-unofficial CFO of the company, controlled all the company accounts and expenses.

Also, Madhuri’s brother-in-law Deepak Gupta serves as head of administration and facilities.

(6/17)

Another major concern was Bharat pe’s risky business practices. The majority of its Rs 3,000 crore loan book was built on peer-to-peer (P2P) loans.

(7/17)

A report of TMC says that the investigation by the agency would consist of 5 aspects

- Recruiting family members in key roles
- Inflating merchant transactions
- Payments to vendors and related parties
- Acquisition of Payback India
- Defaults in the lending business

(8/17)

The independent agency appointed by BharatPe's board, Alvarez and Marsal (A&M) delivered it's report on Jan 24th which revealed similar concerns related to corporate governance & financial irregularities at BharatPe.

2 Main highlights of the report👇

(9/17)

⏩ BharatPe was recruiting staff but fraudulently paying a consultancy firm that had nothing to do with the hired employees.

In 5 sample cases, employees confirmed their joining date as mentioned in invoice but they had no idea of being recruited through d stated firm.

(10/17)

Also, the report pointed out Ashneer Grover’s wife Madhuri Jain and her brother’s direct involvement in this recruitment process.

(11/17)

⏩ The 2nd aspect of the report was on the issue of non-existent vendors which was also revealed in a search operation done by the Directorate General of GST Intelligence (DCGI) in Oct 2021.

(12/17)

The DGGI summoned the authorised signatory at BharatPe and asked them to produce copies of purchase invoices along with transport documents and the bank statement from July 2018 till date.

(13/17)

In reply, BharatPe also sent a communication to DCGI, stating that the company has come to know that some of these vendors did not exist or never operated at their principal place of business.

Also, the company sought a waiver of the show cause notice in the matter.

(14/17)

A report of Bloomberg claims that d investigating Agency, A&M has also reviewed sample invoices related to these vendors where it found some inconsistencies, like same author of these invoices, common layout, common proprietor names across some of these missing vendors.

(15/17)

Grover has denied all accusations, but if reports are to believed, the BOD is planning to terminate d service of Ashneer and her wife!

As per few media publications, Ashneer Grover is demanding Rs 4,000 crore from investors to buy out his stake if they want him to exit.

(16/17)

With all these, the governance issues at BharatPe don't seem to be a newly emerged concern but its BOD and investors had a vested reason for keeping the matter a secret.

However, credits to the hype of Shark Tank & leaked audio clip which brought d issue to d limelight!

(17/17)