Leading consumer internet group, Info Edge, has filed a First Information Report (FIR) against Rahul Yadav, the founder of 4B Networks, and a few others for alleged misuse of funds.
The Allegations
The FIR was lodged by the Bandra Police Station (Mumbai Police) on November 29, 2024, following a complaint filed by AIPL (Info Edge). The accused include Rahul Yadav, Devesh Singh, Pratik Choudhary, Sanjay Saini, and others who are unnamed. The allegations revolve around fraudulent acts involving 4B Networks' funds, an indirect subsidiary of Info Edge.
"Pursuant to a complaint filed by AIPL, a first information report (FIR) has been registered by the Bandra Police Station (Mumbai Police) on November 29, 2024 against Rahul Yadav, Devesh Singh, Pratik Choudhary, Sanjay Saini (and unnamed others) in connection with 4B Networks (an indirect subsidiary of the company), alleging inter alia commitment of certain fraudulent acts involving 4B Networks’ funds," the company stated in an exchange filing.
Also read: Indian Railways’ Revolutionizing Travel with Its First Bullet Train, 250 Kmph Average Speed & Kavach 5.0 (startuppedia.in)
Background of 4B Networks
Founded by Rahul Yadav in November 2020, 4B Networks aimed to facilitate communication between real estate developers and brokers on its platform. The platform also provided loan origination services for end-consumers. Info Edge had invested a substantial sum of Rs 288 crore in 4B Networks through its subsidiary ALLcheckdeals India, holding a majority stake of 59%.
Also read: Market Decides Vehicle Scrap Prices, Govt Has No Role: Nitin Gadkari (startuppedia.in)
Forensic Audit and Legal Proceedings
The Sanjiv Bhikchandani-led Info Edge which operates the popular Naukri.com jobs portal initiated a forensic audit after 4B Networks failed to provide essential information about its operations, financial transactions, and related parties. Subsequently, Info Edge approached the Delhi High Court, leading to arbitration between the two parties. The Economic Offense Wing (EOW) was also brought into the picture, with a complaint filed in August 2023 regarding suspicious transactions involving 4B Realtech Pvt Ltd.
Financial Ramifications
Info Edge incurred a significant loss of Rs 532 crore due to its investment write-off in 4B Networks. Despite injecting Rs 288 crore into the startup, the remaining amount represents a notional loss resulting from a higher valuation of the startup. The startup's valuation stood at Rs 719 crore before Info Edge decided to write off its complete investment.
Also read: Anupam Mittal Says What You Promote on Social Media Gets Sold (startuppedia.in)
/startuppedia/media/media_files/2024/12/02/POps5FqieiQ88wA2Kw3i.jpeg)