Home / Markets / Stock Markets /  Minance CEO, barred by Sebi, is back in disguise, complaint says

NEW DELHI : In 2020, the swift rise of Anurag Bhatia, from Quora influencer to founder-CEO of a wealth management startup, ended in multiple allegations of fraud—and an order from the Securities and Exchange Board of India (Sebi) that barred his Bengaluru-based firm Minance from the securities market. Two years later, a complaint with the Economic Offences Wing (EOW) in Maharashtra alleges Bhatia resurrected himself—with a new hedge fund and a brand-new identity.

In March, the chief executive of an alternative investment firm (AIF) went to the EOW with allegations that Hedonova, a hedge fund he had invested in, was a suspected Ponzi scheme. That’s not all. His complaint, a copy of which was reviewed by Mint, alleges that Hedonova’s chief of investments, Neel Aryan Birla, is none other than Minance founder Anurag Bhatia. “This is part of a potential fraud committed by an individual named Anurag Bhatia. He claimed his name is Neel Aryan Birla and that he works for a firm called Hedonova, lives in Paris, and is the nephew of billionaire industrialist Kumar Mangalam Birla. All of this was later discovered to be false," the complaint said. “This is a clear case of impersonation," the CEO, who asked not to be named for fear that his company might become associated with the fraud in future web searches, said in an interview.

When Mint reached out to Birla, he denied any link with Bhatia. He described himself as an employee of the US-based Hedonova, which he said was co-founded by CEO Alexander Cavendish and chief investment officer Suman Banerjee. “I am not aware of the said Anurag Bhatia, though we have an Anurag Bhalerao in our team who works as a part-time financial content writer. I have no relation with K.M. Birla," he said over email. When the “chatter" about Birla reached Kundan Shahi, the founder of a litigation financing startup LegalPay in which Hedonova has invested an undisclosed sum, he reached out to Birla to clear the air. “Neel told me he didn’t know who Anurag Bhatia was but that there was a content writer in Hedonova with that name," Shahi said.

Birla said he suspected the CEO of “potential fraud". He said he had purchased a painting worth 30 lakh and two securities through the CEO’s firm, which he says have not been transferred to him. “We are considering legal action," he said.

Bhatia rose to fame between 2015 and 2020 as an influencer on Quora and the CEO of a wealth advisory firm that promised retail investors high returns. By 2020, the complaints against Minance were piling up. In September 2020, Bhatia was arrested by the Jaipur police for an alleged 92 lakh fraud. According to the complaint, Bhatia promised to sell 500 Paytm shares to a Jaipur-based businessman at 18,500 each but failed to transfer the shares or return the money. A month later, Sebi banned Bhatia’s Minance till further orders. The directions were confirmed in April 2021. The regulator banned him for not meeting the capital adequacy norms of 25 lakh—the minimum net worth mandatory for investment advisers. Sebi took note that Bhatia and his firm Minance had by then been accused of criminal breach of trust, cheating, misrepresentation and fraud in at least five FIRs.

According to a document reviewed by Mint, Bhatia spent four months in a Jaipur jail. He was released on bail on 5 January 2021 after the Rajasthan high court granted him bail against a personal bond of 1 lakh and two sureties of the sum of 50,000 each.

If the allegations in the CEO’s complaint are true, it suggests Bhatia has not only been able to circumvent a Sebi ban and continues to peddle investment products but has also pulled off a remarkable masquerade.

A former staff who invested in Hedonova before joining the firm said Birla was the only point of contact with staff—and he was mostly a voice at the other end of the line, rarely seen. “Every time there was a Zoom call, Neel would say his video wasn’t working. We asked about Suman Banerjee and other leaders, but Neel always gave excuses—all quite convincing," the ex-employee said. Before quitting, he insisted on one video call with Birla—and recorded a short clip. In the video footage, the speaker appears to be Anurag Bhatia. Mint has access to the video.

Hedonova has received funds from investors to the tune of 7.8 crore, according to a data sheet submitted as evidence to the EOW, which Mint has reviewed. The fund’s website says it has invested in startups such as SpaceX and Swiggy; it mentions Deloitte as auditor, Nishith Desai Associates as general counsel, and Northern Trust as custodian partner. Birla’s bio on Twitter also says he was previously a trader at the New York-based global investment firm Davidson Kempner. When Mint reached out to them, Nishith Desai and Deloitte denied Hedonova was their client. A query sent to Swiggy has not yet been answered. An official from Davidson Kempner, who did not want to be named, said no one with the name “Neel Aryan Birla" has been associated with them; Northern Trust refused to confirm or comment “in accordance with confidentiality policies and laws." Responding to a question on professional expertise, CEO Alexander Cavendish said co-founder Suman Banerjee too, had worked with Davidson Kempner. However, a spokesperson from Davidson Kempner denied any past association with Banerjee.

Cavendish, according to Hedonova’s site, has worked at UBS and Morgan Stanley and is an adviser to the government of Mongolia. But a reverse image search for his photo on the site showed it was first used as a stock photo on a web page of The Princeton Review.

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