SBI calls out Reliance Communications’ ₹31,580 crore loans as ‘fraud’; Bank to report Anil Ambani’s name to RBI

India’s largest state-run bank, the State Bank of India (SBI), on 23 June 2025 decided to classify Reliance Communications’ loan account as “fraud” and is looking to report the company’s director, Anil Ambani, to the banking regulator, the Reserve Bank of India (RBI), exchange filing data showed. 

As per the details shared in the letter to Reliance Communications, the bank’s Fraud Identification Committee (FIC) has decided to classify the loan account as ‘fraud’ due to the deviation in the utilisation of the loan funds. 

What did SBI FIC find? 

The State Bank of India’s FIC witnessed two ‘major’ deviations from the loan taken and utilised by the company.

Reliance Communications received a loan of ₹250 crore from Dena Bank on 8 February 2017, citing  “short-term cash flow mismatch for payment of statutory dues, sundry creditors.” 

Instead of using the funds for the officially mentioned reasons, the company allegedly used the loans to pay the PSU-firm RailTel Corporation of India (RCIL) as an Inter-Corporate Deposit (ICS) or an unsecured loan that one corporate entity grants to another. 

According to the filing, Reliance Comm. management later claimed that the amount was used to repay an External Commercial Borrowing (ECB) taken from BNP-Paribas. 

“Thus, loan was not used for the purpose it was availed,” said SBI’s Fraud Identification Committee, stating that it appears that there was a “routing of transaction” through a subsidiary or an associate company to conceal the source of funds to avoid regulatory approval in the ECB loans case. 

(This is a developing story. Please check back for updates.)