Info Edge, the parent company of jobs listing portal Naukri, lodged a first information report (FIR) against Rahul Yadav, the founder of its portfolio company 4B Networks, and others on Friday over accusations of fraudulent activities related to the misuse of 4B Networks’ funds.
“An 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, alleging inter alia commitment of certain fraudulent acts involving 4B Networks’ funds,” Info Edge said in a stock exchange filing on Saturday.
Yadav is also the cofounder of Housing.com.
Last year in July, Info Edge initiated arbitration proceedings against 4B Networks after the startup failed to give crucial information regarding its operations and management for a forensic audit.
It had appointed Deloitte to conduct a forensic audit of 4B Networks after the startup failed to disclose details of financial transactions and related-party activities sought by the investor.
“There shall be no material financial impact or effect on the company’s business operations on account of the FIR,” it said.
The consumer internet group had written off its equity investment of Rs 276 crore in 4B Networks during the December 2022 quarter citing excessive cash burn, prevailing liquidity issues and uncertainty regarding funding options.
Info Edge said at the time that the startup was showing strong growth but due to high cash burn and the overall funding environment, decided to write off the investment following “principles of conservatism.” Info Edge cofounder Sanjeev Bikhchandani has also admitted that investing in the startup was a mistake.
Founded in November 2020, 4B helped real estate developers and brokers communicate and conduct business through the Broker Network Platform. It also assisted brokers in conducting site visits and offering home-loan-related services to clients.
Info Edge’s subsidiary Allcheckdeals India Pvt Ltd (AIPL) had invested Rs 288 crore, including Rs 12 crore as debt financing, in 4B Networks.
Source Homevior.in
