Pakistan’s fintech director faces lawsuit in US court after ‘fraudulent actions’

DOVER – Talal Ahmad Gondal, who stepped down as director of Pakistani fintech startup TAG, is now facing a lawsuit by another director in Delaware’s Court as the latter seeking to remove Mr Gondal over illegal actions as he was accused of being the architect who took the company to the ground.

The startup which offered services like online payment transfers, and paying bills besides mobile top-up features, was valued at $100 million in the country’s largest seed round but things went haphazard as Mr. Gondal was accused of being directly involved in allegedly forging an official document that was then sent to State Bank of Pakistan.

Lately, Taraec Hussein moved the court of equity in the US state of Delaware against Talal Ahmad Gondal, maintaining that Gondal refused to step down as director despite an agreement.

In his petition, the complainant maintained that Mr. Gondal has diverted financial assets from the company to personal accounts and is now planning to transfer the intellectual property to a UAE-based firm.

Earlier this year, the State Bank of Pakistan canceled TAG’s license to operate in South Asian countries and ordered refunds to customers after which it was decided that Gondal will relinquish his access to the company bank accounts, expand the board to three seats, and give up his seat on the board.

Following the above-mentioned agreement, Taraec Hussein became a member of the firm’s board in May while one of TAG’s co-founders Alexander Lukianchuk also took a seat on the board.

With a third vacant seat, the complainant maintained that the conditions for filling the third seat have not been met, opposing Gondal to take it as director.

Citing Gondal’s lack of authority, the complainant maintained that the former no longer holds no right with the only two directors of the firm authorized to decide for the vacant seat.

Taraec Hussein representing investors sued Talal Ahmad Gondal derivatively on behalf of the company, TAG Fintech Inc., alleging that Gondal has continued to act fraudulently.

In case Talal is found guilty of Wire fraud, he faces up to 20 years in prison, and can result in a fine of up to $250,000.

Case details

Taraec Hussein v. Talal Ahmad Gondal et al., case number2022-1111, in the

Court of Chancery of the State of Delaware.