The Central Bureau of Investigation has registered a fresh case against Reliance Communications (RCOM) Ltd and its erstwhile promoter and chairman, Anil Ambani, on charges of causing a loss of ₹3,750 crore to the Life Insurance Corporation (LIC) of India. According to latest reports, the LIC in its complaint to the CBI alleged that the Corporation was fraudulently induced to subscribe to Non Convertible Debentures (NCDs) worth ₹4,500 crore between 2009 and 2012 on the basis of false representations made by RCOM and its management regarding the company's financial health, security and asset cover at the time of subscribing NCDs. The CBI has filed the case on charges of conspiracy, fraud, and misappropriation, as well as under the provisions of the Prevention of Corruption Act, making it the fourth case the agency registered against the Anil Ambani group of companies on allegations of defrauding a number of banks.
The complaint was made on the basis of a forensic audit report dated October 15, 2020, conducted by M/s BDO India LLP. The audit report found that RCOM and its management had misused funds raised from banks and financial institutions, routed funds through subsidiaries, misused sale invoice financing, and discounted fictitious bills. The LIC's complaint also accused Reliance and its accused officials of systematically siphoning funds through inter-company deposits and shell-related entities, creating and writing off fictitious debtors and receivables, and grossly overstating security. The report stated that there was a mismatch between the assets and liabilities, according to the latest CBI filing.
According to the latest reports, the LIC historically held a significant stake in RCOM, which reached over 7 per cent in 2009. However, by 2017, RCOM was facing financial stress, and the LIC struggled to recover on bond investments. The company is now under the Corporate Insolvency Resolution Process (CIRP). There was a mismatch between the charges and the assets, the agency stated, according to the latest CBI filing.
The CBI's investigation has expanded beyond the LIC case, with separate complaints received from Punjab National Bank, Bank of India, Union Bank of India, UCO Bank, Central Bank of India, IDBI Bank, and Bank of Maharashtra. Additionally, another case was registered on February 25 based on a complaint from Bank of Baroda dated February 24, which includes exposure of e-Dena Bank and e-Vijaya Bank. The CBI had earlier registered three cases against RCom Ltd, Anil Ambani, and others on allegations of defrauding a number of banks, with Anil Ambani also being interrogated by the CBI at its head office in Delhi for two days in connection with the alleged ₹2,929.05 crore SBI fraud case.
As reported by the latest CBI filing, the LIC accused Anil Ambani's company of offences of conspiracy, fraud, misappropriation and offences under the Prevention of Corruption Act. This marks the fourth case the CBI registered against the Anil Ambani group of companies and others on allegations of defrauding a number of banks. The insurer suffered a loss of over ₹3,750 crore and ordered a forensic audit against the company, leading to the current CBI investigation. Investigation of the case is currently in progress, according to the latest official statement.
