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Fraud in Rajasthan over hotel bookings! FIR against OYO founder Ritesh Agarwal for cheating over Rs 22 crore

Economic Times April 14, 2025

In a major controversy shaking the hospitality industry, an FIR has been registered against OYO Rooms founder and CEO Ritesh Agarwal at the Adarsh Nagar police station in Jaipur, Rajasthan. The complaint, lodged by Hussain Khan, President of the Hotel Association of Rajasthan, alleges that OYO and its management were involved in fraudulent practices that led to a loss of over ₹22 crore to various hotel owners across the state. According to the FIR, OYO reportedly failed to clear dues to partner hotels despite repeated follow-ups and contractual obligations. The complaint claims that the company manipulated hotel bookings, withheld payments, and altered terms unilaterally, leaving many small and mid-size hoteliers in financial distress. Several hotels had partnered with OYO under the promise of increased bookings and timely payments but allegedly received neither. The FIR names Ritesh Agarwal and other key executives under sections related to cheating, criminal breach of trust, and conspiracy as per the Indian Penal Code. The complainant also highlighted that multiple attempts were made to resolve the matter amicably, but OYO did not respond satisfactorily. The Rajasthan police have initiated an investigation, and further action will follow based on the findings. Meanwhile, hotel associations in other states have expressed solidarity and are urging authorities to scrutinize OYO’s operations nationwide. OYO has not yet released an official statement in response to the FIR. The case has sparked widespread debate in the hospitality sector about the ethics and sustainability of aggregator-based business models, especially in their dealings with smaller partners. As the investigation continues, all eyes are on the outcome, which could have far-reaching consequences for both OYO’s reputation and the trust between tech-driven platforms and local businesses.