Ambani’s Reliance Communications in Deep Trouble: Bank of Baroda Labels Loan Accounts as ‘Fraud’
New Delhi(The Uttam Hindu): The troubles for debt-ridden Reliance Communications Limited (RCom) and its former director Anil Ambani continue to deepen. In the latest blow, public sector lender Bank of Baroda has declared the company’s loan accounts as “fraud,” a move linked to borrowings taken before the firm entered corporate insolvency resolution proceedings (CIRP).
The bank disclosed this development in a filing to the stock exchanges on Friday. This comes after State Bank of India (SBI) in June 2024 and Bank of India in August had already classified RCom’s accounts as fraudulent. Bank of India had cited fund diversion and violation of loan conditions as key reasons.
RCom, however, issued a clarification stating that all such loans pre-date the insolvency process and will be addressed under the approved resolution plan. The company added that its affairs are currently being managed by Resolution Professional Aneesh Niranjan Nanavati, while Anil Ambani no longer sits on the board. The resolution plan has already been cleared by the Committee of Creditors (CoC) and is awaiting final approval from the National Company Law Tribunal (NCLT).
The company further emphasized that under the Insolvency and Bankruptcy Code (IBC) 2016, no fresh legal action can be initiated against it during the resolution process. Meanwhile, Bank of Baroda has confirmed that it will submit its report on the fraud classification to the Reserve Bank of India (RBI) and other relevant regulators.
This latest setback coincides with an ongoing Enforcement Directorate (ED) investigation into an alleged ₹17,000 crore loan fraud involving Anil Ambani’s group companies, including Reliance Housing Finance, RCom, and Reliance Commercial Finance. The ED has already sought details from 12–13 banks regarding loans linked to these entities.
Industry experts believe Bank of Baroda’s move could have far-reaching implications—not only for RCom’s insolvency proceedings but also as a significant signal in India’s broader battle to resolve mounting non-performing assets (NPAs) within the banking sector.