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I was half-joking, but if YC has a legal issue resulting from the alleged fraud (unclear currently), kicking out the company for the lesser infraction would make more sense.

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Investors aren't on the hook for the bad behavior of companies they invest in. Quite the opposite: Defrauding investors (and acquirers, and creditors) is commonly the thing that lands people like Elizabeth Holmes in prison.

Ycombinator may have financially benefited from the scam operations since the company subsequently raised funds.

Considering they do due diligence before investment and are experts in IT and legal, how could they not know what is the business model when it was the unique selling point ?

Because Delve defrauded them.

Yeah, yeah... of course, of course... like telehealth companies prescribing GLP-1 Ozempic/Wegovy where there is one doctor for 10000 patients. Totally sounds legit.

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