New Delhi: A pseudonymous Twitter account holder has created a controversy by circulating allegations that Jabong co-founder and former chief executive officer (CEO) Praveen Sinha made personal gains from business dealings at the fashion website—charges which he has denied.
Sinha said he had filed a legal case against the Twitter account holder who posted the damaging tweets.
Sinha’s denial comes on the back of reports in The Ken and The Economic Times newspaper that highlighted some of these dealings based on a purported report by Pricewaterhousecoopers (PwC) Stockholm, which, they said, conducted a forensic investigation of Jabong.
The alleged probe report by PwC and its excerpts were made public by an anonymous twitter handle, Unicon Baba. Excerpts of the report were carried by The Economic Times on Monday and The Ken on Saturday.
Mint, too, has a copy of the report and is in the process of verifying its authenticity before making its content public. Jabong’s investor Global Fashion Group and PwC in Stockholm are yet to respond to emails seeking comment.
Sinha says he has been unfairly accused of wrongdoing.
“Firstly, I have never been informed by Jabong’s investors of any PwC report. I came to know of it recently through a media query, to which I was not even given a day to respond. While it is very easy for any person/media to speculate and make false allegations, it is equally difficult for the subject of such allegations to prevent the damage and reputational loss he/she suffers on account of the same. Post the report, I have called many people to get more information, and I have come to understand that though there was indeed an investigation, nothing had come out of it to conclude any personal gains (were made by me) as is being alleged by certain quarters,” Sinha said in an email response.
PwC is purported to have investigated the management of Jabong and related-party transactions between them and some of the company’s vendors.
Much of the investigation revolves around GoJavas, a company owned by Sinha, a majority of which was later sold to online fashion marketplace Snapdeal (Jasper Infotech Pvt. Ltd).
According to people familiar with the matter who asked not to be identified, this was an interim report filed in January while the probe continued for several more months. A final report has already been submitted and is only accessible to senior management at Global Fashion Group (GFG).
The probe was conducted when Nils Chrestin, chief financial officer of GFG, served Jabong as its interim CEO for a brief period in late 2015 when the company witnessed an exodus of senior managers, two of the people said.
The media reports come at a time when Jabong’s investors, GFG and Rocket Internet, may have managed to find a buyer for Jabong.com after struggling for 12-18 months now.
So, what triggered the sudden rush of news articles?
It all started on 7 June when a person known only as Unicon Baba, who tweets on start-ups under the handle @uni_con1 posted that Rocket Internet was pursuing a case against Sinha.
The tweet, which was later deleted by Unicon Baba, read: “Rocketinternet to pursue case against @sinha_praveen for siphoning off 100 cr+ in last two years.”
An infuriated Sinha had his lawyers write to Twitter HQ seeking the identity of Unicon Baba. Sinha also filed a criminal complaint against Unicon Baba. The letter also asks Twitter to provide details of the location from which Unicon Baba is tweeting.
Sinha said in his emails that the timing of the media reports is “unfortunate”. “As regards the timing of the release, it is indeed extremely unfortunate that this issue is being sensationalized at a time when multiple positive developments were shaping up for the companies in question. I hope these developments will not be adversely impacted by the false and baseless news reports. I am sending you these prefatory thoughts as I am currently travelling,” he wrote.