SEBI Bars Anil Ambani, Slaps ₹25 Crore Fine in Major Fraud Scandal

The Securities and Exchange Board of India (SEBI) has taken stern action against industrialist Anil Ambani and 24 other entities, including former key officials of Reliance Home Finance Ltd (RHFL), barring them from the securities market for five years over a large-scale diversion of funds.

SEBI has also imposed a hefty penalty of ₹25 crore on Ambani, prohibiting him from holding any position as a director or Key Managerial Personnel (KMP) in any listed company or intermediary registered with the regulator.

In its detailed 222-page final order, SEBI revealed that Anil Ambani, along with RHFL's top executives, orchestrated a fraudulent scheme under the guise of corporate loans, diverting funds to entities connected to him. Despite repeated instructions from RHFL's Board of Directors to halt such practices, the management, including Ambani, disregarded these directives.

As part of the ruling, RHFL itself has been barred from the securities market for six months and fined ₹6 lakh. SEBI’s investigation concluded that Ambani and the KMPs funneled funds through conduit borrowers, many of whom were financially unfit, deliberately diverting resources. Most of these borrowers defaulted, leading to RHFL’s own debt default and subsequent resolution under the Reserve Bank of India (RBI) framework.

The fraudulent loans, often approved for companies with little to no assets or revenue, resulted in significant losses for RHFL’s public shareholders, affecting over 9 lakh investors. RHFL’s stock price collapsed from ₹59.60 in March 2018 to a mere ₹0.75 by March 2020 as the scandal unfolded.

SEBI has also imposed penalties on several key players, including former RHFL executives Amit Bapna (₹27 crore), Ravindra Sudhalkar (₹26 crore), and Pinkesh R Shah (₹21 crore). In addition, hefty fines of ₹25 crore were levied on several associated entities, including Reliance Unicorn Enterprises, Reliance Exchange Next Ltd, Reliance Commercial Finance Ltd, and Reliance Big Entertainment Pvt Ltd, all of which were either recipients or intermediaries in the fraudulent scheme.

This ruling follows SEBI's interim order in February 2022, which had already barred Ambani, RHFL, and three others from the securities market for alleged siphoning of company funds.

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