The Securities and Exchange Board of India (SEBI) has taken stringent action against industrialist Anil Ambani and 24 other entities, including key former officials of Reliance Home Finance Ltd (RHFL), for their involvement in a fraudulent scheme to divert funds from the company. The market regulator has barred them from participating in the securities market for a period of five years. SEBI has also imposed a hefty penalty of ₹25 crore on Anil Ambani and restrained him from any association with the securities market, including serving as a director or Key Managerial Personnel (KMP) in any listed company or intermediary registered with the regulator. Additionally, Reliance Home Finance Ltd has been barred from the securities market for six months and fined ₹6 lakh.
SEBI highlighted Fraudulent scheme
In a detailed 222-page final order, SEBI highlighted the orchestration of a complex fraudulent scheme by Anil Ambani, with the assistance of RHFL’s key managerial personnel. The scheme involved siphoning off funds from RHFL by disguising them as loans to entities linked to Ambani.
Despite the Board of Directors of RHFL issuing strong directives to halt such lending practices and conducting regular reviews of corporate loans, the company’s management failed to adhere to these orders. SEBI noted this as a significant governance failure, driven by certain key managerial personnel under the influence of Anil Ambani.
The SEBI order stated that its investigation had “established the existence of a fraudulent scheme, orchestrated by Noticee No. 2 (Anil Ambani) and administered by the KMPs of RHFL, to siphon off funds from the public listed company (RHFL) by structuring them as ‘loans’ to credit unworthy conduit borrowers, and in turn, to onward borrowers, all of whom have been found to be ‘promoter linked entities’ i.e. entities associated/linked with Noticee 2 (Anil Ambani).”
Anil Ambani was found to have used his position as the ‘chairperson of the ADA group’ and his significant indirect shareholding in the holding company of RHFL to facilitate this fraudulent activity.
SEBI’s Action Against 24 Entities
In addition to Anil Ambani, SEBI’s crackdown extended to 24 other entities, including former key officials of RHFL—Amit Bapna, Ravindra Sudhalkar, and Pinkesh R Shah. SEBI imposed penalties of ₹27 crore on Amit Bapna, ₹26 crore on Ravindra Sudhalkar, and ₹21 crore on Pinkesh R Shah.
Several other entities linked to the Reliance Group were also penalized, including Reliance Unicorn Enterprises, Reliance Exchange Next Ltd, Reliance Commercial Finance Ltd, Reliance Cleangen Ltd, Reliance Business Broadcast News Holdings Ltd, and Reliance Big Entertainment Private Ltd, each of which was fined ₹25 crore.
