Anil Ambani appears before ED for questioning in bank loan 'fraud' probe; what is the case?

The Enforcement Directorate (ED) began questioning Reliance Group chairman Anil Ambani on Tuesday (August 5) in a Rs 17,000-crore money laundering case linked to multiple bank loan frauds allegedly involving companies owned by him.

Ambani arrived at the ED office in central Delhi at around 10:50 a.m. Officials said his statement is being recorded under the Prevention of Money Laundering Act (PMLA).

Here’s a lowdown on the case:

What is the case?

The ED is probing Ambani’s role in the alleged financial irregularities and collective loan "diversion" pegged at more than Rs 17,000 crore by multiple group companies owned by him including Reliance Infrastructure (R Infra) and Reliance Communications (RCOM).

Yes Bank loan diversion

The central agency alleges that “illegal” loan amounting to Rs 3,000 crore was diverted by Yes Bank to Reliance Group companies between 2017 and 2019.

Sources told PTI that the ED suspects that just before the loan was granted, Yes Bank promoters "received" money in their companies.

The agency is investigating this nexus of "bribe" and the loan.

ED has reportedly identified issues like loans to entities with weak financials, lack of proper documentation, back-dated credit approvals, and violations of Yes Bank’s credit policy.

Also read: ED raids Odisha firm against 'fake' bank-guarantee racket

The loans are alleged to have been "diverted" to many group companies and "shell" (bogus) companies by the entities involved.

The agency is also looking at some instances of loans given to entities with weak financials, a lack of proper documentation of loans and due diligence, borrowers having common addresses and common directors in their companies, etc., according to the sources.

Fake bank guarantees case, 1 held

As part of its probe, ED has arrested Partha Sarathi Biswal, managing director (MD) of Biswal Tradelink Pvt Ltd, for providing fake bank guarantees worth Rs 68.2 crore to the Solar Energy Corporation of India (SECI) on behalf of Reliance Power. The ED alleges that Reliance Power gave Biswal Tradelink Rs 5.4 crore to help with the fake bank guarantees using a spoofed domain that resembles the State Bank of India (SBI).

ED sources told PTI that Biswal may be confronted with Ambani during questioning.

Also read: ED raids Anil Ambani group companies in Yes Bank loan 'fraud' case

Loan fraud of Rs 1,050 crore

The agency is also said to be probing a loan fraud of over Rs 1,050 crore involving Canara Bank and other foreign bank accounts. The alleged scam came to light after SBI classified RCOM as fraudulent in 2020.

The Centre recently apprised Parliament about the SBI’s classification of RCOM along with Ambani as "fraud".

‘Diversion’ of Rs 10,000 crore

This apart, the ED is also probing the alleged diversion of Rs 10,000 crore by R Infra to other group companies through an undisclosed private entity without naming it as a related party. The SEBI, in a report,t had flagged the alleged irregularity. The transactions reportedly include inter-corporate deposits, equity investments, and guarantees along with reported write-offs of Rs 10,110 crore between FY17 and FY21.

Also read: Canara Bank withdraws order classifying Anil Ambani’s loan account as ‘fraudulent’

A Reliance Group spokesperson had denied any wrongdoing and said in a statement that the allegation regarding alleged diversion of Rs 10,000 crore to an undisclosed party was a 10-year-old matter and the company had stated in its financial statements that its exposure was only around Rs 6,500 crore.

Reliance Infrastructure had publicly disclosed this matter on February 9, 2025, nearly six months ago, the statement said.

"Through mandatory mediation proceedings conducted by a retired Supreme Court judge and the mediation award filed before the Honourable Bombay High Court, Reliance Infrastructure arrived at a settlement to recover its 100 per cent exposure of Rs 6,500 crore," it said.

The company added that Ambani had not been on the board of R Infra for more than three years (March 2022).

Other allegations

Reliance Mutual Fund is also stated to have invested Rs 2,850 crore in AT-1 bonds, and a "quid pro quo" is suspected here by the agency.

Also read: SBI to tag RCom loan account as 'fraud'; names Anil Ambani in report to RBI

Additional Tier 1 (AT-1) are perpetual bonds issued by banks to increase their capital base, and they are riskier than traditional bonds, having higher interest rates.

What prompted the probe?

The money laundering case stems from at least two CBI FIRs and reports shared by National Housing Bank, SEBI, National Financial Reporting Authority, and Bank of Baroda with the ED.

These reports, the sources said, indicate there was a "well-planned and thought after scheme" to divert or siphon off public money by cheating banks, shareholders, investors and other public institutions.

Also read: SEBI bans Anil Ambani, 24 other entities from securities market for 5 years

Summons, raids, arrests

The summons came after the agency conducted searches at 35 premises of 50 companies and 25 people, including executives of Ambani’s business group, in Mumbai on July 24.

The ED has notified a Look Out Circular (LOC), as per standard operating procedure in large bank 'fraud' cases, against Ambani even as some executives of his group have also been summoned to appear for questioning during the week as part of this probe.

As mentioned earlier, ED has also recently arrested Biswal Tradelink MD Biswal for allegedly providing a fake bank guarantee of Rs 68 crore for a Reliance Group company.