Anil Ambani, the chairman of Reliance Group, has been summoned by the Enforcement Directorate (ED) to appear for interrogation on August 5. The summons is a component of a money laundering investigation that is currently underway and is connected to a bank loan fraud case that is allegedly worth approximately Rs 3,000 crore, according to sources.
This comes after the ED raided several sites connected to Ambani's businesses on July 24. Targeting the locations of 50 businesses and 25 people, including multiple Reliance Group executives, the three-day search operation was conducted in Delhi and Mumbai in accordance with the Prevention of Money Laundering Act (PMLA). The ED questioned over 25 people during these searches and confiscated a large number of documents and computer accessories.
The investigation is based on two First Information Reports (FIRs) filed by the Central Bureau of Investigation (CBI). According to probe agency sources, the case primarily focuses on allegations of illegal loan diversion. It is alleged that approximately Rs 3,000 crore in loans were granted by Yes Bank to Ambani's group companies between 2017 and 2019. The ED is also investigating a potential "bribe" and loan nexus, as it was found that Yes Bank promoters allegedly received money in their companies just before the loans were sanctioned.
Also Read: ED raids Anil Ambani-linked sites in Mumbai after SBI fraud tag
The ED's investigation has uncovered several "red flags," including the issuance of loans to companies with weak or unverified financial sources, the use of common directors and addresses across multiple borrowing entities, a lack of essential documentation in loan sanction files, the routing of funds to shell entities, and instances of "loan evergreening," where new loans were given to repay existing ones.
In response to the raids, two of the group's companies, Reliance Power and Reliance Infrastructure, released statements to the stock exchanges on July 26. They acknowledged the ED's action but asserted that the raids had "absolutely no impact" on their business operations, financial performance, shareholders, employees, or any other stakeholders.
Also Read: ED extends raids against Anil Ambani Group firms for third day
Several regulatory and financial bodies have also shared their findings with the ED. These include the National Housing Bank (NHB), the Securities and Exchange Board of India (SEBI), the National Financial Reporting Authority (NFRA), and Bank of Baroda. SEBI has submitted a report that highlights "serious irregularities" within Reliance Home Finance Limited (RHFL), a group company. The report noted that the firm's corporate loan portfolio nearly doubled from Rs 3,742 crore in fiscal year 2017-18 to Rs 8,670 crore in fiscal year 2018-19.
Separately, the State Bank of India (SBI) has classified Reliance Communications (RCom), another group company of Anil Ambani, and Ambani himself as "fraud" accounts. This is not the first time such a classification has been made. In November 2020, SBI deemed RCom and Ambani's accounts to be fraudulent, and in January 2021, it lodged a complaint with the CBI. However, the complaint was withdrawn a day later after the Delhi High Court issued a status quo order.
Also Read: ED raids end quietly; Reliance firms assert clean slate
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