ED Cracks Down on Alleged Money Laundering at Reliance Anil Ambani Group

The Enforcement Directorate (ED) on Thursday initiated a comprehensive search operation targeting 35 sites, including 50 companies and over 25 individuals, in connection with an alleged money laundering scheme involving the Reliance Anil Ambani Group (RAAGA). Official sources report that this action stems from a Central Bureau of Investigation (CBI) FIR concerning the financial misconduct allegations against RAAGA companies.

Officials revealed that various agencies, including the National Housing Bank, SEBI, National Financial Reporting Authority (NFRA), and Bank of Baroda, have contributed information assisting the ED's investigation. Preliminary findings suggest that RAAGA orchestrated a scheme to misappropriate public funds by deceiving banks, shareholders, and other stakeholders. The investigation also scrutinizes potential bribery of Yes Bank's promoters.

Initial probes have uncovered an unlawful diversion of approximately Rs 3,000 crores in loans from Yes Bank between 2017 and 2019. The ED has discovered that these loans were granted under suspicious circumstances, with Yes Bank promoters allegedly receiving funds just before loan approvals. The agency is delving into this alleged link between bribery and loan transactions.

According to officials, Yes Bank's loan approval process for RAAGA companies was marred by violations, such as retroactive Credit Approval Memorandums and lack of due diligence. Loans were illicitly diverted to affiliated companies and shell entities, flouting loan terms. Red flags include poorly documented loans, commonalities among borrowers, and loans suspiciously sanctioned, disbursed, or onward lent on the same day they were applied for.

Additionally, the Securities and Exchange Board of India (SEBI) has reportedly shared pertinent findings with ED regarding Reliance Home Finance Limited (RHFL). A dramatic surge in RHFL's corporate loans—from Rs 3,742.60 crores in FY 2017-18 to Rs 8,670.80 crores in FY 2018-19—is under scrutiny, alongside various procedural irregularities and anomalies.

(With inputs from agencies.)