Cofounder Sachin Dev Duggal has been listed as a suspect in an accused money laundering case, while another cofounder, Saurabh Dhoot, is in dock in connection with an alleged loan fraud case.
Builder.ai is an artificial intelligence (AI)-powered software development platform. The company provides technical solutions for creating customized digital products.
Court documents obtained by FT revealed that the ED was investigating transactions between 2008 and 2012 that “clearly indicated” that Videocon moved monies to a business created by Duggal in India.
Duggal and Dhoot co-founded London-based Builder.ai, a startup that has been supported by a clutch of major tech investors, including Microsoft and SoftBank’s DeepCore AI-focused fund.
The co-founders of AI startup Builder.ai have reportedly been arrested by the Enforcement Directorate in connection with two separate criminal investigations.
According to the Financial Times, cofounder Sachin Dev Duggal has been designated a suspect in an alleged money laundering case, while another cofounder, Saurabh Dhoot, is being investigated for potential loan fraud.
The ED’s money laundering investigation into the now-bankrupt electronics manufacturer Videocon is important to the Duggal saga. In 2022, the agency is believed to have summoned Duggal to attend as a witness in an investigation into suspected “unexplained transactions” between his company (not Builder.ai) and Videocon.
Court documents obtained by FT revealed that the ED was investigating transactions between 2008 and 2012 that “clearly indicated” that Videocon moved monies to a business created by Duggal in India. These proceeds were reportedly moved to Videocon’s overseas subsidiaries.
After Duggal refused to appear before the ED, the agency applied to a Mumbai court for a “non-bailable warrant” against him. The request was denied.
In 2023, the directorate changed his designation from “witness” to “suspect” and sought the Delhi High Court with the same plea. This time around, the petition was approved.
Meanwhile, Duggal reportedly filed an appeal against the warrant and denied any wrongdoing. His lawyers told the FT that the original court summons were unlawful, and that Duggal was still simply a witness.
According to comments made by Duggal’s counsel before the Delhi High Court, he stated that the ED was “abusing its powers, provisions of law, in as much against a person who has been cooperating wholeheartedly with it”.
Duggal and Dhoot were cofounders of London-based Builder.ai, which has received backing from a number of major tech investors, including Microsoft and SoftBank’s DeepCore AI fund.
Founded in 2016, the company (formerly Engineer.ai) aims to use artificial intelligence to make the process of creating an app or website “as simple as ordering pizza.”
The two met at university in the early 2000s and became “best” friends, according to Duggal’s prior claims. They looked to collaborate extensively in Builder.ai’s early days.
Duggal publicly thanked Dhoot for “the most defining week of our life” after the firm got a new investment in 2018, before thanking both of their wives. Later, as OpenAI’s ChatGPT sparked a generative AI revolution, it appeared that Builder.ai’s time had come.
Last year, the business launched a new $250 million fundraising round led by Qatar’s sovereign wealth fund, which included top US tech investors Insight Partners and Iconiq Capital.
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