Vendor files FIR against Rahul Yadav alleging fraud

Trouble against founder of 4B Network's Rahul Yadav continues to intensify with a Rajasthan based vendor filing a first information report (FIR) against him alleging fraud and criminal breach of trust.

The vendor, Vikas Om Prakas Noval has filed the FIR under section 406, 409, 420, 34 of the Indian Penal Code.

The vendor, who runs an advertising agency, has alleged that the company has defrauded them and owes them Rs 10 crore for the work they did for 4B Networks in 2022.

“During February 2022-September 2022…. This company offers installation printing, display, mounting, bedding and other advertising related services … a total of 83 advertisement hoardings were put up by our company in different places in Pune city during the month of April to August,” read the copy of the FIR. ET Prime has seen a copy.

This happens at a time when Yadav's company is already undergoing a forensic audit by investor Info Edge for not disclosing details of financial transactions and related-party activities when asked for by the investor.

In June Info Edge disclosed to the stock exchange it had hired Deloitte to conduct the audit.

Info Edge 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 significant uncertainty towards funding options”.

In an interaction with ET Prime in June, Yadav had dismissed all these allegations against him.

Yadav did not immediately respond to the query for this story.

4B Networks, which was founded in 2020, helped real estate developers and brokers communicate with each other and conduct business through Broker Network Platform.

While announcing the write-off of its investment in 4B Networks, InfoEdge had said that 4B Networks was showing good growth, but given the startup’s rate of cash burn and the overall funding environment that led to the investor following “the principles of conservatism”, it decided to write off the investment.

Also read: Rahul Yadav: I stopped sharing data and Info Edge sent me a notice. You call it financial fraud?