Enforcement Directorate Summons Anil Ambani for Questioning in ₹17,000 Crore Loan Fraud Case; His Companies Had Been Raided Earlier.
Anil Ambani: The Enforcement Directorate (ED) has summoned Anil Ambani, Chairman and Managing Director of Reliance Group, for questioning. He has been asked to appear at the ED headquarters in Delhi on August 5. This summons has been issued under the investigation into an alleged bank loan fraud and money laundering case involving ₹17,000 crore. Prior to this, the ED had conducted raids on several companies and individuals associated with the Reliance Group on July 24.
Raids at Over 35 Locations in Mumbai
The ED conducted raids at at least 35 locations in Mumbai under the Prevention of Money Laundering Act (PMLA). These raids were carried out against 50 companies of the Reliance Group and 25 individuals associated with them. The agency seized documents and electronic evidence related to loan fraud and fund diversion. This action was taken while a thorough investigation of the case was underway.
Two CBI FIRs Form the Basis of the Investigation
This investigation began following two FIRs registered by the Central Bureau of Investigation (CBI). These FIRs allege that serious financial irregularities occurred in the loans given by Yes Bank to Anil Ambani's companies between 2017 and 2019. According to the ED, Yes Bank promoters received a suspiciously large sum of money just before the loans were issued. The agency suspects that the entire transaction may be part of bribery and conspiracy.
Several Flaws Found in Loan Disbursement
The ED's investigation revealed that the financial sources of the companies to which the loans were given were not properly investigated. Many companies had the same director and address. Necessary documents were also missing from the loan files. In addition, some companies emerged as shell companies, which were issued loans without any solid guarantees. New loans were even given to repay old debts, which is a blatant violation of banking rules.
Reliance Group Responds
Reliance Power and Reliance Infrastructure informed the stock exchange on July 26 that they are cooperating with the investigating agencies. Both companies also clarified that the raids have had no impact on their day-to-day operations, financial condition, investors, employees, or any other stakeholders.
Reports from SEBI and Other Institutions Also Included in the Investigation
Not only the ED, but other financial regulators have also played a role in this case. Institutions such as SEBI (Securities and Exchange Board of India), National Housing Bank (NHB), National Financial Reporting Authority (NFRA), and Bank of Baroda have also submitted their reports to the ED. According to SEBI's report, Reliance Home Finance Limited's (RHFL) corporate loan portfolio increased from ₹3,742 crore in 2017-18 to ₹8,670 crore in 2018-19, which is an unusual increase and raises questions about the transparency of financial transactions.
Fraud Accounts Had Been Declared Earlier
This is not the first time that Anil Ambani's companies have been accused of financial irregularities. In November 2020, the State Bank of India (SBI) declared the accounts of Reliance Communications (RCom) and Anil Ambani as fraud accounts. Following this, a complaint was filed with the CBI on January 5, 2021, but the complaint was withdrawn on January 6 due to a stay order issued by the Delhi High Court. Now, once again, this matter has prominently come under the purview of investigation.
