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Info Edge Files FIR Against 4B Networks Founder Rahul Yadav, Others for Fraud

• ByStartupStory     |    December 2, 2024

Info Edge (India) Ltd, a leading consumer internet group and the parent company of Naukri.com, has filed a First Information Report (FIR) against Rahul Yadav, the founder of its portfolio company 4B Networks, and several associates. The allegations pertain to fraudulent activities involving the misuse of 4B Networks’ funds.

The FIR was lodged on November 29, 2024, at the Bandra Police Station in Mumbai. “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,” Info Edge disclosed in its exchange filing.

4B Networks, founded in November 2020 by Rahul Yadav, was designed to facilitate communication between real estate developers and brokers, enabling seamless business operations and loan origination for end consumers. Info Edge invested a total of ₹288 crore in the company through its subsidiary ALLcheckdeals India, acquiring a 59% stake.

Issues surfaced when 4B Networks failed to provide Info Edge with vital information regarding its operations, financial transactions, and dealings with related parties. This lack of transparency, which Info Edge stated was a contractual obligation, prompted the company to initiate a forensic audit in 2023.

In July 2023, Info Edge approached the Delhi High Court, which directed both parties to enter arbitration. Subsequently, in August 2023, Info Edge filed a complaint with the Economic Offense Wing (EOW), accusing 4B Networks and Yadav of engaging in “suspicious transactions” with 4B Realtech Pvt Ltd, a company allegedly linked to Yadav’s associate.

The fraudulent activities have dealt a significant financial blow to Info Edge. The company has written off its entire investment in 4B Networks, amounting to ₹532 crore. Of this, ₹288 crore represents the actual cash infusion into the startup, while the remainder is a notional loss based on the company’s earlier valuation of ₹719 crore.

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