ED Issues Look Out Circular Against Anil Ambani In ₹17,000-Crore Loan Fraud Probe

Mumbai: The Enforcement Directorate (ED) has issued a Look Out Circular (LoC) against Anil Ambani, chairman of the Anil Dhirubhai Ambani Group (ADAG), in connection with its ongoing probe into an alleged Rs 17,000-crore bank loan fraud case. The LoC was issued on Friday at the request of the federal financial probe agency to prevent Ambani from leaving the country without prior clearance, senior officials confirmed.

Ambani Summoned in ₹17,000 Crore Bank Fraud Investigation

The ED has summoned the industrialist for questioning on August 5 as part of its investigation. According to officials, the case pertains to alleged diversion and misappropriation of loans availed by various ADAG group companies from a consortium of banks and financial institutions.

ED Conducts Nationwide Raids Linked to Reliance Group

On July 24, the ED conducted extensive searches at 35 premises tied to Anil Ambani’s Reliance Group, covering 50 companies and 25 individuals. The action followed a money laundering case registered after a CBI FIR and involved entities under the Reliance Anil Ambani Group of Associates (RAAGA) umbrella of large-scale fund siphoning and default, triggering scrutiny under the Prevention of Money Laundering Act (PMLA).

Separate FEMA Investigation Also Underway

In addition, Ambani is facing a separate investigation under the Foreign Exchange Management Act (FEMA) for suspected foreign exchange violations, according to officials.

The ED said the case is based on inputs from agencies including SEBI, the National Housing Bank, the National Financial Reporting Authority, and Bank of Baroda. According to officials, initial findings reveal a “well-planned scheme to siphon public funds” by misleading banks and investors. Sources said that the ED had earlier recorded statements of several key executives of ADAG and conducted forensic examination of transactions linked to multiple group entities.

Yes Bank Link Under Forensic Scrutiny

Investigators have reportedly uncovered suspicious transactions involving entities connected to Yes Bank’s promoters, where funds were routed to privately held companies shortly before sanctioning large unsecured loans to firms associated with the RAAGA. Officials suggest these transactions indicate a possible quid pro quo arrangement, with Yes Bank officials, potentially including its promoter, playing a facilitative role in extending credit in exchange for financial favours. The nature of these linkages is currently under forensic scrutiny.

The ED has also flagged systemic lapses in the loan sanctioning process, including the use of backdated Credit Approval Memorandums (CAMs), absence of credit assessments, and instances where loan disbursals preceded formal applications.

Probe Reveals Alleged Loan Diversions and Shell Company Links

The agency has also flagged the diversion of funds to shell companies linked to RAAGA and entities linked to promoters, as well as the presence of borrowers with common directors and registered addresses. These patterns, officials said, suggest a broader strategy of “evergreening” loans, a practice wherein fresh loans are issued to repay earlier ones, thereby concealing defaults and artificially maintaining asset quality.

Meanwhile, SEBI has reportedly submitted its findings in relation to Reliance Home Finance Ltd (RHFL), highlighting a sharp increase in corporate loan exposure from Rs 3,742.6 crore in 2017–18 to Rs 8,670.8 crore in 2018–19. The ED is currently examining possible irregularities in loan approvals, expedited disbursals, and deviations from established procedures.