On Friday (31st October), 40 properties totalling Rs 3,000 crore have been attached by the Enforcement Directorate (ED) as part of its money laundering investigation into the Anil Ambani-headed Reliance Group. His home in posh Pali Hill of Mumbai, the Reliance Centre complex in Delhi and other properties in the national capital, Noida, Ghaziabad, Mumbai, Pune, Thane, Hyderabad, Chennai, Kancheepuram and East Godavari, among others are included.
According to Section 5(1) of the Prevention of Money Laundering Act (PMLA), the assets were attached and comprised of office space, residential apartments and land parcels after the orders issued on 31st October. The attachments are worth Rs 3,084 crore in total.
The central agency stated that it continuously tracks down criminal money and secures property attachments. A spokesperson conveyed, “Recoveries made by ED would ultimately benefit the general public.”
The attachment was issued by the ED in a case involving the diversion and laundering of public monies by Reliance Commercial Finance Ltd. (RCFL) and Reliance Home Finance Limited (RHFL).
The official pointed out, “During 2017–2019, Yes Bank invested Rs 2,965 crore in RHFL instruments and Rs 2,045 crore in RCFL instruments. These turned into non‑performing investments by December 2019, with Rs 1,353.50 crore then outstanding for RHFL and Rs 1,984 crore for RCFL.”
The spokesperson further mentioned, “During the investigation, the ED has found that direct investment by the erstwhile Reliance Nippon Mutual Fund into Anil Ambani Group financial companies was not legally possible due to SEBI’s mutual fund conflict‑of‑interest framework. In violation of these guidelines, the money invested by the general public in the mutual fund was routed indirectly through Yes Bank exposures, which ultimately landed with Anil Ambani Group companies.”
According to a second officer, the probe revealed that money was transferred indirectly through Yes Bank’s holdings in RHFL and RCFL, while RHFL and RCFL provided loans to organisations associated with the Reliance Anil Ambani Group.
“The fund-tracing by ED found diversion of funds on lending to group linked entities and ultimate siphoning off. Substantial portions of corporate loans (General Purpose Corporate Loans) ultimately landed in accounts of Reliance group companies,” the second official stated.
Investigations have also shown that loans to businesses connected to the group were expedited without the necessary prudential checks. “Many loans were processed on the same day as application, sanction and agreement, and in some cases, disbursal preceded sanction. The funds were advanced even before the application for a loan, which can be possible only if the applicant time-travelled. Field investigation and personal discussions were waived,” the spokesperson outlined.
ED ucovered numerous deliberate and persistent control lapses during the inquiry. “It has been found that documents were left blank, overwritten and undated. Several borrowers had weak financials or negligible operations. Security creation was inadequate or unregistered, and security schedules were left blank, the end use did not match the sanction conditions,” the officer disclosed.
The investigation into the loan fraud scheme involving Reliance Communications Ltd. (RCOM) and other businesses has also been stepped up by the agency.
The officer highlighted, “ED has found that these companies diverted over Rs 13,600 crore used in evergreening loans, over Rs 12,600 crore was diverted to connected parties and over Rs 1,800 crore was invested in FDs/MFs etc, which was substantially liquidated for rerouting to group entities. Huge misuse of bill discounting for the purpose of funnelling funds to connected parties has also been detected by ED.”
The two FIRs (First Information Reports) filed by the Central Bureau of Investigation (CBI) against Anil Ambani and his companies for suspected bank loan frauds serve as the foundation for the probe under the Prevention of Money Laundering Act.
Ambani, his colleagues and group entities have been the subject of numerous searches by the ED since July, including at his home in Mumbai. On 5th August, he was also called to the ED headquarters in Delhi and questioned there. Ambani is already prohibited from leaving the country due to a travel ban. ED has previously interrogated some of his close acquaintances, including his close aide Angarai Sethuraman.
The Ambani group company Reliance Communication, which owns the Reliance Centre office on Maharaja Ranjit Singh Marg in Delhi, is being probed for embezzling around 13,600 crore in finances. The matter pertains to the misappropriation of over 20,000 crore bank funds.
