The Securities and Exchange Board of India (SEBI) has imposed a five-year ban on industrialist Anil Ambani and 24 other entities, including former key officials of Reliance Home Finance Ltd (RHFL), for their involvement in a major fund diversion scheme. SEBI has also imposed a hefty penalty of ₹25 crore on Ambani and barred him from holding any directorial or managerial positions in listed companies or registered intermediaries during this period.
SEBI’s investigation revealed that Ambani, along with RHFL’s key managerial personnel, orchestrated a scheme to divert funds from the company. These funds were disguised as loans to entities linked to Ambani. Despite directives from RHFL’s Board of Directors to halt such practices, the company’s management ignored these orders, highlighting a severe governance failure.
Reliance Home Finance itself has been barred from the securities market for six months and fined ₹6 lakh. SEBI’s findings pointed to a fraudulent scheme where loans were granted to entities with questionable financial standing, many of which were closely connected to Ambani. These loans were not repaid, leading to RHFL’s default on its obligations and its subsequent resolution under the RBI Framework.
The share price of RHFL fell dramatically from ₹59.60 in March 2018 to just ₹0.75 by March 2020, leaving over 900,000 shareholders with significant losses.
In addition to Ambani, SEBI has imposed fines on key officials Amit Bapna, Ravindra Sudhalkar, and Pinkesh R Shah, with penalties of ₹27 crore, ₹26 crore, and ₹21 crore respectively. Other involved entities, including Reliance Unicorn Enterprises and Reliance Big Entertainment Private Ltd, have each been fined ₹25 crore for their roles in the fund diversion scheme.
