SBI labels loan account of Ambani as fraud; other banks likely to take similar action, say reports

NEW DELHI: The State Bank of India (SBI) has decided to classify the account of Reliance Communications (RCom), where Anil Ambani served as a non-executive chairman, as fraud and report it to the Reserve Bank of India (RBI). The move comes after it was found that the company diverted loan funds for other purposes. SBI has also informed that Anil Ambani’s name will be included in the report. Indications suggest that other banks which provided loans to RCom may take similar action.

However, Agrawal Law Associates, representing Anil Ambani, has alleged that SBI acted unilaterally without hearing Ambani’s side. They claimed that Anil Ambani was merely a non-executive director and had no role in the company's day-to-day operations or decision-making processes. Due to the loans turning into non-performing assets (NPAs), RCom is currently facing insolvency proceedings under the Insolvency and Bankruptcy Code (IBC). The company is no longer operational, and its shares have been suspended from trading. Agarwal Law Associates argued that SBI did not provide Ambani with any opportunity to be heard or supply related documents before branding the account as fraudulent. They have demanded that the decision to label the account as fraud be withdrawn.

As a result of SBI’s move, Anil Ambani and other directors of the company may face a five-year ban from accessing banking facilities. RCom and its related entities had taken loans totalling Rs 31,580 crore from various banks. Out of this, Rs 13,667 crore was reportedly diverted to repay other debts and liabilities of RCom. SBI's Fraud Identification Committee found that the remaining amount was also allegedly diverted in a similar manner. According to reports based on data up to March 2025, the company’s total outstanding liabilities amount to Rs 40,413 crore.