The board of Indian payments company BharatPe has decided to terminate the services of Ashneer Grover, the company’s co-founder and managing director, Mint reported on Sunday, citing two people familiar with the developments.
The decision, the paper said, is based on a preliminary internal investigation that has yielded indications of financial fraud.
BharatPe is aiming to quell investor disquiet over a public row involving personal investments by one of its co-founders with an independent audit to bolster internal governance rules, two sources with direct knowledge told Reuters.
The audit – conducted by PwC and Alvarez & Marsal – will assess if BharatPe’s senior executives are making proper internal disclosures about personal investments and check for conflicts, leading to a new code of conduct, one of the sources said.
BharatPe, which allows shop owners to make digital payments through QR codes, has come under intense investor and Indian media scrutiny as it hopes to list. It competes with the likes of Paytm.
Grover sought damages from Uday Kotak, head of Kotak Mahindra Bank, alleging that the bank declined financing for a personal investment.
‘Foul’ Language
Kotak Mahindra Bank has in turn alleged that Grover has used “foul” and threatening language towards its employees and reserved the right to take legal action against him.
Grover, Kotak and BharatPe did not respond to Reuters’ requests for comment.
Grover, 39, said the bank turned down his and his wife’s request for 5 billion rupees ($67 million) to invest in the IPO of an Indian beauty products company at the “eleventh hour”.
Kotak bank cited “very high lending rates” among the reasons for refusing financing, the second legal document shows.
Investors have expressed concerns about the damage to BharatPe’s image. Grover has taken leave from BharatPe until the end of March as a result of the furore generated by his dispute with Kotak.
- Reuters, with additional editing by George Russell
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