Did Paytm just bury corporate governance along with the charges against Sonia Dhawan?

And just like that the case files of Sonia Dhawan-Vijay Shekhar Sharma-Paytm have moved towards a quite burial, with all indications pointing to a silent out of court settlement and closure. The case, which grabbed headlines for the incredible combination of alleged extortion of a billionaire founder by one of his most trusted and closest employees and her husband, seems to have collapsed most unexpectedly.

With Sonia Dhawan’s final ‘rehabilitation’ with an assignment at Sheroes, a firm backed by said billionaire founder among others, all the players, Devendra Kumar, Rupak Jain (Sonia Dhawan’s husband) , Rohit Chomwal (an accomplice turned ‘approver’) and Sharma himself, look set to close this chapter behind them, with many mysteries unresolved.

Why are we calling it settlement? To understand this let’s get back into history on the case.

The whole drama started with levelling of serious charges of extortion and blackmailing, ostensibly engineered by Dhawan and three others. Sharma’s brother and senior management member at Paytm, Ajay Shekhar Sharma lodged an FIR which led to Dhawan, Kumar and Rupak Jain (Dhawan’s husband) arrested.

Following the investigation, police filed a chargesheet that asserted they’re in possession of documentary evidence and submissions from witnesses that corroborated the complaint registered by Sharma and Paytm. According to the police, the three (Dhawan, Jain, and Devendra) also accepted their part in the crime and they had enough grounds to book them.

Importantly, Sonia Dhawan’s husband, Rupak Jain also lodged a complaint alleging a call from an unknown person asking for Rs 5 crore (two days after Sharma got the alleged extortion call). As per his counsel, the caller threatened to malign Dhawan’s image and harm her family if their demand was not met.

Acting on the complaint, police had claimed to trace the number and also sent a special team to Bahraich (Uttar Pradesh) to nab the caller. This trail seems to have gone cold with no further information from the police to report.

However, what did change was Sharma’s tune, within a week of Dhawan’s arrest. Sharma now expressed apprehensions of her being just a pawn in someone else's sinister plan.

This is not all.

Police described the fourth accused Chomwal as a prime accused in the case until the second half of November 2018. The police seemed to be on firm ground here as Chomwal was apparently ‘proven’ to be the person who made extortion calls to Sharma.

Things took an unprecedented turn when Sharma allegedly convinced Chomwal to spill the beans. And when Chomwal did so on the assurance of no further action against him apparently, he got a clean chit from Sharma brothers based on his willing cooperation.

The duo had even expressed their “thankfulness and gratitude” to Chomwal over WhatsApp, for helping them reach company vice-president Dhawan and others involved in the data theft case.

Amidst this apparent bonhomie between the Sharma brothers and Chomwal, the latter got protection from Allahabad Court against an arrest. Meanwhile, Dhawan and her husband kept applying for bail without getting any relief from the judiciary, presumably on the basis of strong evidence in the hands of the police that was presented to the relevant judge.

Strong evidence being, a hard disc recovered with “Paytm personal information and secret data”, a pen drive which has “calls/chat records of extortion” printouts of the WhatsApp chats and four mobile phones.

However, after three and a half months (on February 6), Jain got bail on the basis of insufficient evidence connected with him and the crime. A month and a week later Dhawan also got out on bail. The court found no active role of the applicant and allegations could not be deemed as concrete. An incredible result, considering the time they were held in custody.

And all that “strong evidence” just vanished into thin air, along with the police team that investigated the case? A police team, whose captain was suspended after being caught red-handed while taking a bribe.

With Dhawan’s release, if the media and people tracking the case expected the fog around the case to clear, they were to be disappointed. What they did get was news that Dhawan was set to re-join Paytm.

Aren’t the above series of factual incidents outline that it’s a clear case of settlement?

Yet, not convinced? No worries. Let me give you more twists.

Regulatory filings show that on June 6 the Paytm board allotted equity shares to six employees, including Dhawan, who had applied to exercise options vested under the employee stock ownership plan. This was the final surprise which proved the direction of events now.

But Dhawan’s return to Paytm to work with the same employees who had been told she was effectively a criminal and persona non grata was always a tough scenario, her complete rehabilitation in a ‘friendly’ firm was the next best option, after all, she went through and the ‘settlement’.

And what better option than Dhawan’s appointment to Sheroes as a Director, Corporate Communications. Sheroes, of course, is a Sairee Chahal led firm where Sharma has been an early backer. Chahal herself is on the board of Paytm Payments Bank, to complete the network.

So there you have it, rehabilitation complete, everyone happy? Not quite.

Quite frankly, don’t be too surprised if this too is a makeshift arrangement to allow things to cool down further.

But what shouldn’t cool down is the questions around corporate governance this whole exercise has raised. More specifically, the investors in both Paytm and to an extent, Sheroes. Just how come they have gone along with all these shenanigans without batting an eyelid?

With storied investors like Berkshire Hathaway now, and of course Alibaba and SoftBank, it’s remarkable that things have moved the way they have. For founders, and other stakeholders who consider the presence of these investors in a firm as a sign of professionalism, the whole experience has probably raised more questions than answers.

For contrast, consider Binny Bansal’s fate at Flipkart, where his ‘crime’ was to delay informing the board about the nature of allegations against him, a transgression that was used to justify his ejection from the firm, by new promoter Walmart, another US-based firm like Berkshire Hathaway.

One wonders just how well informed Paytm’s board has been about the travails of its Founder and ‘key’ employees in the past few months.

Questions that one feels, Paytm will need to answer, sooner than later. Because it seems increasingly clear that Dhawan will be the last person to speak on this issue anymore.