ED Summons Anil Ambani on August 5 in FEMA Violation Probe

The Enforcement Directorate (ED) has summoned Anil Ambani, Chairman and Managing Director of the Reliance Group, for questioning on August 5 in connection with a ₹17,000 crore loan fraud and money laundering case under the Prevention of Money Laundering Act (PMLA). This development comes after ED conducted searches at 35 locations in Mumbai linked to the Reliance Group, covering 50 companies and 25 individuals.

Alongside the ED’s probe, the Securities and Exchange Board of India (SEBI) has submitted findings of a separate investigation, as reported by The Economic Times. SEBI has alleged that Reliance Infrastructure (R Infra), a key company in the Reliance Group, diverted approximately ₹10,000 crore through inter-corporate deposits (ICDs) to other Reliance Group entities. The transactions were routed via CLE Pvt Ltd, a private engineering and construction company based in Santacruz East, Mumbai, which had not been disclosed as a related party.

According to SEBI, R Infra transferred funds to CLE over several years without informing shareholders or audit committees, which is a legal requirement. SEBI accused R Infra of portraying these transfers as regular business transactions, thereby masking the movement of funds within group companies. The report further claimed that R Infra avoided necessary disclosures by treating CLE as a third-party company.

An individual familiar with the group contested SEBI’s findings, stating that the alleged fund diversion figure of ₹10,000 crore was incorrect. According to this source, Reliance Infra had already disclosed an exposure of ₹6,500 crore on February 9 and had taken legal measures to recover the amount through mediation involving a retired Supreme Court judge. The matter was filed with the Bombay High Court. The same individual also clarified that the recovery from Odisha’s power distribution companies — a key component of the mediation agreement — was still pending in court, and no notice had been received from SEBI.

In May, SEBI forwarded its findings to the ED, the National Financial Reporting Authority (NFRA), and the Insolvency and Bankruptcy Board of India (IBBI), urging them to independently examine the matter.

SEBI’s investigation revealed that R Infra funneled funds to CLE through various methods — loans, share investments, and corporate guarantees. By March 31, 2022, R Infra’s total exposure to CLE stood at ₹8,302 crore. The probe covered the financial years 2016 to 2023. Notably, between 2017 and 2021, R Infra wrote off ₹10,110 crore due to provisions, fair value adjustments, and impairments. Despite CLE’s apparent inability to repay, R Infra continued funding it.

SEBI also found that CLE’s financial dealings formed a significant part of R Infra’s assets — ranging from 25% to 90% annually between 2013 and 2023. Furthermore, SEBI alleged that CLE was deliberately not named as a related party to avoid mandatory corporate governance procedures, including shareholder and audit committee approvals.

Supporting documents cited in the report included CLE’s filings with Yes Bank naming R Infra as a promoter, audit meeting notes identifying CLE as a group company, and CLE’s bank-linked emails all ending with "@relianceada.com". SEBI also highlighted that several CLE directors and managers were part of Reliance Group’s leadership, indicating a close connection.

Anil Ambani, who held over a 40% stake in R Infra until March 2019 and served as non-executive chairman and director until March 25, 2022, is believed by SEBI to have had significant control over the company's financial decisions during the alleged fund diversion period.