SEBI bans Anil Ambani and 24 others from securities market for 5 years
The mounting bad loans of Reliance Home Finance have attracted SEBI’s attention, which was expressed by the regulator in an order issued on Thursday.
The Securities and Exchange Board of India (SEBI) has put 25 persons, including Anil Ambani and former RHFL (Reliance Home and Finance Ltd) Senior Officials, under a five-year restriction. This move follows allegations of fund diversions from the company. Additionally, SEBI has imposed a penalty of Rs 25 crore on Anil Ambani, reflecting their strict stance in the case. This significant action underscores SEBI’s commitment to enforcing regulations and holding individuals accountable.
In a related development, Reliance Home Finance has been restrained from accessing the securities market for a period of six months by SEBI and further penalized to the tune of Rs six lakh. In its 222-page final order that summarized its findings, SEBI provided information on how Anil Ambani and other managers of RHFL defrauded the company with the help of a scheme of misrepresenting transactions as bogus loans by shell companies linked to him. Even though the Board of Directors of RHFL has ordered that such lending practices be ceased and that the corporate loan portfolio is reviewed frequently to identify and restrain such rogue credit facilities, the management has not complied with these directives.
According to NDTV reports, the SEBI findings stated “existence of a fraudulent scheme, orchestrated by Noticee No. 2 (Anil Ambani) and administered by the KMPs of RHFL, to siphon off funds from the public listed company (RHFL) by structuring them as ‘loans’ to credit unworthy conduit borrowers, and in turn, to onward borrowers, all of whom have been found to be ‘promoter linked entities’ i.e. entities associated/linked with Notice 2 (Anil Ambani).”
The mounting bad loans of Reliance Home Finance have attracted SEBI’s attention, which was expressed by the regulator in an order issued on Thursday, August 22, where the SEBI became critical of the reckless management of the company and its promoter for sanctioning loans to the extent of hundreds of crores to various firms that have negligible assets, cash flow, or net worth and/or revenue. SEBI also imposed severe fines on the players such that Anil Ambani was penalized Rs.25 crore. Likewise, 27 crore was recovered from Amit Bapna, Ravindra Sudhalkar was penalized Rs 26 crore while Pinkesh R Shah was penalized Rs 21 crore each
Beside this, SEBI also fined several entities Rs 25 crore each for receiving the ill-gotten loans or for being involved in the unlawful process of funnelling funds from Reliance Home Finance Ltd (RHFL), where it also imposed penalties on Reliance Unicorn Enterprises, Reliance Exchange Next Ltd, Reliance Commercial Finance Ltd, Reliance Cleangen Ltd, Reliance Business Broadcast News Holdings Ltd, and Reliance Big Entertainment Private Ltd.
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