Ex-Union secretary seeks SC-monitored probe into alleged bank fraud by RCOM, Anil Ambani

A public interest litigation (PIL) has sought a court-monitored investigation into what it alleges to be a large-scale banking fraud involving Reliance Communications Ltd (RCOM), its group companies, and former promoter Anil Ambani.

The writ petition, filed by former Union secretary Emani Anantha Satyanarayana Sarma (E.A.S. Sarma) in the Supreme Court on Monday, was mentioned before a bench led by Chief Justice B.R. Gavai by senior advocate Prashant Bhushan. The court listed the matter for hearing.

The plea, as seen by Mint, alleges that RCOM, Reliance Infratel, and Reliance Telecom diverted ₹31,580 crore in loans disbursed by the State Bank of India (SBI)-led consortium of banks between 2013 and 2017.

It argues that the Central Bureau of Investigation's (CBI) August 2025 FIR and related Directorate of Enforcement (ED) proceedings “cover only a fraction” of the alleged wrongdoing and do not examine “the role of bank officials and regulators, despite detailed forensic audits pointing to widespread diversion of funds”.

“The investigating agencies… have overlooked the five-year delay in filing the FIR by the bank, which clearly indicates involvement of bank officials and other public servants whose conduct enabled, concealed, or facilitated the fraud.”

The 2020 audit

A 2020 forensic audit commissioned by SBI uncovered extensive financial irregularities, according to the petition.

The audit allegedly found large-scale diversion of funds, including repayment of unrelated loans, transfers to related parties, investments in mutual funds and fixed deposits that were immediately liquidated, and circular transactions used to disguise loan evergreening. It also recorded entries from bank accounts that had already been closed, suggesting fabrication of financial statements.

“Despite being in possession of the 2020 forensic audit report… the bank chose to take no statutory action until August 2025, a delay that cannot be explained without examining whether officers acted in collusion or with deliberate intent to shield the borrower group,” the plea adds.

The petition says shell entities such as Netizen Engineering and Kunj Bihari Developers were allegedly used to siphon funds, and cites sham preference-share structures that helped write off more than ₹1,800 crore in liabilities. The petitioner argues these findings show a deliberate effort to hide losses and divert public funds.

It also highlights similar patterns of financial irregularities in other Anil Ambani-linked firms, including Reliance Capital, involving the diversion of funds through loss-making subsidiaries, questionable write-downs, and offshore structures routed through Mauritius, Cyprus, and the British Virgin Islands—all pointing to possible Foreign Exchange Management Act (FEMA) and Prevention of Money Laundering Act (PMLA) violations.

Sarma contends that the current CBI and ED probes do not address core issues, such as forged accounts, the use of non-existent bank accounts, shell-company layering, cross-border transactions, or the role of senior officials, auditors, and regulators. Without examining these aspects, the investigation “falls short of constitutional requirements under Article 21”.

A detailed late-night emailed query sent to Anish Niranjan Nanavaty, the current resolution professional of Reliance Communications, remained unanswered till press time.

A spokesperson for Reliance Communications, in response to Mint’s queries, referred to the company’s earlier statement issued on 30 October, when similar allegations were made by investigative portal Cobrapost that the company had committed a massive financial fraud exceeding ₹41,921 crore through diversion of funds across group companies since 2006.

At the time, the Reliance Group had strongly denied the charge, stating:

“Reliance Group strongly condemns Cobrapost’s malicious campaign to tarnish its reputation, and mislead stakeholders. The corporate rivals appear to be orchestrating this alleged exercise with the malicious intent to tarnish the reputation of Reliance Infrastructure Limited, Reliance Power Limited, Anil D. Ambani, and one of the largest family of over 55 lakh shareholders. Their underlying motive is to influence public perception, and manipulate market sentiment to serve their own vested commercial interest."

It further added: “A dead platform resurrected as a corporate hit-job. Dormant since 2019, Cobrapost has zero journalistic credibility, and a 100% track record of agenda-driven stings. Cobrapost’s sudden ‘revival’ is fully funded by entities with direct commercial interest to acquire Reliance Group assets. Malicious campaign aimed at crashing the stock prices, and engineer panic in stock markets to acquire Reliance Group assets. Recycling of old publicly available information, already examined by CBI, ED, SEBI and other agencies. An organized attempt to prejudice a fair trial.”

SC-monitored probe

The PIL seeks a Supreme Court-monitored, comprehensive investigation covering the full forensic audit record, related insolvency proceedings, and other available material. It also asks for probes into potential offences under the IPC, Prevention of Corruption Act, PMLA, FEMA, Companies Act, SEBI Act, RBI guidelines, and the Insolvency and Bankruptcy Code.

“Fraud of this magnitude, involving public money and public institutions, cannot be investigated in a piecemeal manner… The five-year unexplained delay by the complainant bank and the inertia displayed by the RBI and the ED clearly indicate deeper institutional complicity,” says the plea.

The petition comes as Anil Ambani and several Reliance Group (Anil Dhirubhai Ambani Group) entities are already under scrutiny. The CBI recently conducted searches in Mumbai in a separate loan-fraud case involving RCOM. Meanwhile, the ED has widened its money-laundering probe, raiding more than 35 premises linked to over 50 group companies in July 2025.

By November 2025, the ED had frozen assets worth ₹3,084 crore and attached 132 acres of land in Navi Mumbai valued at ₹4,462 crore, citing suspected laundering of proceeds from bank loans.

RCOM officially entered the bankruptcy process in May 2019.