Another blow for Anil Ambani: Bank of India declares RCom loans 'fraudulent'

Mumbai: In a fresh setback for Reliance Communications (RCom) and its promoter Anil Ambani, the Bank of India (BOI) has declared the loan accounts of the company, its promoter, and Reliance Telecom as fraudulent, days after a similar move by the State Bank of India (SBI).

In a filing with stock exchanges on Sunday, RCom confirmed receiving a letter from BOI dated August 8, which was delivered to the company on August 22. The bank alleged diversion of funds and violation of loan terms, formally tagging the accounts of RCom, Anil Dhirajlal Ambani, and Manjari Ashik Kacker as fraudulent in relation to an outstanding loan of ₹724.78 crore.

According to BOI, the account turned non-performing asset (NPA) in June 2017, and despite repeated follow-ups with both the borrowers and guarantors, no repayments were made. The account of Borrower turned NPA on 30.06.2017 with an outstanding of Rs 724.78 crores. The Bank has been following up with the Borrowers and Guarantors for repayment of dues; however, they have failed and neglected to make repayment of the dues,” BOI’s notice stated, as cited by the company in its disclosure.

Additionally, BOI issued a notice to Reliance Telecom Limited, declaring its account fraudulent along with those of its directors, Grace Thomas and Satheesh Seth, in connection with a default of ₹51.77 crore. Others named in the bank’s notice include Gautam Bhailal Doshi, Dagdulal Kastruchand Jain, and Prakash Shenoy.

RCom and its subsidiaries had in total borrowed around ₹31,580 crore from a consortium of banks, making it one of the country’s largest telecom debt defaults.

Meanwhile, the Central Bureau of Investigation (CBI) has ramped up its investigations into the matter. On Saturday, CBI teams conducted searches at two locations in Mumbai, including Anil Ambani’s residence and RCom’s office premises. These actions followed the registration of a fresh case of alleged bank fraud worth ₹2,929.05 crore on August 21, based on a complaint filed by SBI.

The complaint accuses RCom, Anil Ambani, unnamed public servants, and others of cheating the bank through misrepresentation of facts to obtain loans. Investigators allege that funds were misused and diverted via inter-company loan transactions, inter-corporate deposits, misuse of sales invoice financing, discounting of bills, and fund routing through group entities. Irregularities included the writing off of capital advances provided to Netizen Engineering Pvt. Ltd., a company under the Reliance ADA Group.

A spokesperson for Anil Ambani, however, rejected the allegations as baseless, stating that he will contest and defend himself against the charges.

With inputs from IANS