MCA will look into allegations against OnMobile, says Moily

Yesterday, OnMobile's Managing Director and CEO Arvind Rao resigned from the post amid allegations of financial irregularity and his resignation was accepted by the Board. The company said based on a recently concluded special review by its legal advisers and KPMG, weaknesses had been identified in some processes and "recognising that these weaknesses took place during his tenure, Rao has submitted his resignation".

It added that the company has initiated steps to rectify all the weaknesses. In the last few weeks, there had been reports of the company setting up a probe against Rao to look into alleged misappropriation of funds. The company had, however, denied "all rumours and allegations, which are baseless and devoid of factual accuracy".

OnMobile's Co—founder and Executive Director Mouli Raman has now been given charge as the interim Managing Director as the company has initiated a search for a new CEO.

"I respect Arvind's decision...As a company, we are committed to upholding the highest corporate governance standards and we seek the continued support of all the stake holders to help OnMobile realise its true potential," Chairman of the Board H H Haight had said. Shares of the company gained 8.93% to close at Rs 36.60 on the BSE.