A US bankruptcy court ordered Byju Raveendran, founder of edtech giant Byju’s, to pay more than $1 billion after he defaulted by failing to comply with court directives in a case involving the alleged diversion of funds.
The ruling arose from ongoing legal proceedings initiated by lenders, who accused Raveendran and Byju’s Alpha of mishandling $533 million from a $1.2 billion loan. Moreover, the court described the order as “extraordinary,” citing the unique circumstances of the case, and directed Raveendran to provide a full accounting of the transferred funds.
Byju’s Alpha, the entity at the centre of the allegations, faced scrutiny over claims that $533 million moved through OCI Limited in a round-tripping scheme. In a sworn declaration, OCI founder Oliver Chapman alleged that Raveendran intended to divert most of the funds to a Singapore-based entity for personal use. However, Raveendran denied all allegations.
The default judgment followed repeated failures by Raveendran to comply with court orders. Consequently, lenders filed a motion for default on August 11, citing his refusal to participate in the legal process. The court further noted that despite mounting sanctions—including $10,000 per day for non-compliance—Raveendran made no payments.
Under the ruling, Byju’s must pay $533 million related to the 2022 transfer of Alpha’s funds and an additional $540.6 million for the 2023 transfer involving Camshaft hedge fund interests. As a result, the penalties underscored the scale of the transactions under investigation and highlighted the court’s demand for transparency in cross-border financial dealings.
The case continues to attract attention from financial and legal communities. Meanwhile, stakeholders await further disclosures on the use and destination of the disputed funds, as the court’s insistence on detailed accounting aims to clarify the matter.
