Ex employer harrasing

Dear Sir, My friend was working with one of the insurance company before Joining he was doing his business since 2008. Since IRDA Do not allow buying of leads this company had done a contract with third party company for call centre services later on company had used same company to procure leads n pass the payment to lead vendors through third party. My friends another friend has taken over business has done a contract with third party company to provide leads similarly my friends wife was also in the same business of proving leads she has also got into contract with third party company to provide leads now employer has charged my friend of raising fictitious invoices n passing the payment however my friend has all the emails through which the leads is been passed to company / third party company n payments made. My friend has left job about a year back now employer has sent legal notice. The arrangement of procuring leads through third party was with 5 different companies and this was suggested by legal team to avoid regulatory compliance issues. What steps should my friend take to avoid getting into any trouble. Regards, Vishal