(Bloomberg) -- BharatPe, one of India's leading fintech firms, began legal proceedings against its co-founder and his wife for allegedly embezzling and misusing company money, in what could mark the first case of its kind in the nation's thriving startup ecosystem.
Most Read from Bloomberg
Putin Calls Russian Nukes Deterrent Factor, Says War Risk Rising
Peru's President Accused of Coup After Move to Dissolve Congress
Why Did So Many US Men Quit Working? Social Status May Hold the Key, Study Says
Be Careful, Here Come the Predictions for 2023
Musk Spars With San Francisco Over Probe of Bedrooms at Twitter
The company sued Ashneer Grover and his wife, Madhuri Jain, for damages worth about 880 million rupees ($10.7 million), according to a civil lawsuit filed Wednesday in the Delhi High Court, a copy of which Bloomberg News reviewed. BharatPe has also moved the court to restrain Grover from making derogatory public statements about the company.
Grover and his family face 17 additional criminal charges in a separate complaint filed by BharatPe with the economic offenses wing of the Delhi police. Among the charges are that Grover siphoned money from BharatPe, embezzled funds and is guilty of a criminal breach of trust. He faces a 10-year prison sentence if convicted.
Tensions between Grover and other leaders at BharatPe, which is backed by global investors including Sequoia Capital and Tiger Global Management, reached a climax in March, when the 39-year-old entrepreneur was forced to resign. The company's C-suite accused Grover of using funds to bankroll a lavish lifestyle, allegations he has vehemently denied.
Grover didn't respond to a message seeking comment on the latest criminal complaint and civil lawsuit against him. The Delhi High Court has given his legal team two weeks to reply.
The public showdown between BharatPe and Grover has cast a cloud over India's dynamic startup economy, where venture money has helped fuel the rise of an ambitious new class of millionaires eager to displace the old guard.
Grover, who co-founded BharatPe in 2018, helped transform the company into a unicorn, going toe-to-toe with older rivals such as Paytm and the Walmart Inc.-owned PhonePe. The tech company found enormous success offering digital payment services across India.
He was also the driver of growth and a master marketer, making public appearances in snazzy jackets and landing zingers on fresh-faced entrepreneurs as a "shark" investor on the first Indian edition of Shark Tank. Grover doesn't have a place in the line-up for the upcoming second season.
--With assistance from Sankalp Phartiyal and Shruti Mahajan.
Most Read from Bloomberg Businessweek
Airbus Is Coming for Boeing's 737
China Is the Wild Card for Global Inflation in 2023
The Cult of the Retail Trader Has Fizzled
The Viral List That Turned a Yale Professor Into an Enemy of the Russian State
The Club With a 60,000-Woman Waitlist
©2022 Bloomberg L.P.