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MS Dhoni, Deepika Padukone, and Ashneer Grover were among key investors in EV startup BluSmart, now under fire after Gensol fraud allegations shook its operations.
The Securities and Exchange Board of India (Sebi) in its preliminary investigation found issues within Gensol Engineering.
The unfolded Gensol fund scandal has brought into limelight a major issue to corporate world – the risks of fraud and misgovernance perpetrated by a company’s promoters to fund their lavish lifestyles. This turmoil has led to the suspension of EV-cab service company BluSmart’s business operations.
The Securities and Exchange Board of India (Sebi) in its preliminary investigation found issues within Gensol Engineering. Sebi has barred the company’s promoters, Anmol Singh Jaggi and Puneet Singh Jaggi, from the securities market due to allegations of misusing public company funds for personal gain.
Some Stellar Names Invested In Ride-Hailing Startup
Some popular celebrities and businessmen invested in the EV startup. According to MoneyControl report, MS Dhoni, Deepika Padukone, Ashneer Grover, and Sanjiv Bajaj are among the investors of EV startup BluSmart.
Padukone was among the first investors, with the actor’s family office contributing $3 million in an angel funding round in 2019.
During the same round, Sanjiv Bajaj, managing director of Bajaj Capital, supported the startup with a $3 million investment alongside JITO Angel Network and Rajat Gupta.
Last year, the company secured $24 million in pre-series B funding, which included investments from Dhoni’s family office, Sumant Sinha of ReNew Power, and a Swiss asset management firm.
Gensol Fraud Saga: Everything You Need To Know
The promoters of Gensol Engineering primarily Jaggi Brothers are accused of siphoning off loan funds meant for the company, misleading investors, lenders, and regulators. The interim order not only restricts them from accessing capital markets but also prevents them from holding key positions in any listed company for the time being.
It is the alleged misuse of nearly Rs 262 crore from the Rs 978 crore loaned to Gensol by the Indian Renewable Energy Development Agency (IREDA) and Power Finance Corporation (PFC). The funds were intended for acquiring 6,400 EVs for leasing to BluSmart, but only 4,704 vehicles were purchased. Sebi’s findings suggest that a portion of the funds was redirected to personal luxuries, such as high-end real estate, foreign travel, golf equipment, and other personal expenses.
