The Enforcement Directorate (ED) made its first arrest in the alleged ₹3,000 crore loan fraud case involving Anil Ambani-led Reliance Group companies, intensifying scrutiny of one of India’s largest ongoing corporate financial investigations.
The arrested individual, identified as Sanjay Bhatia, is a senior executive associated with Reliance Infrastructure Ltd., and was taken into custody under the Prevention of Money Laundering Act (PMLA), 2002. Officials say Bhatia played a “pivotal role” in the alleged diversion and layering of bank loans obtained by the company through multiple entities.
Allegations of Loan Diversion and Financial Irregularities
The ED probe stems from multiple First Information Reports (FIRs) filed by public sector banks and the Central Bureau of Investigation (CBI), which alleged that loans worth ₹3,000 crore extended to various Reliance Group entities were not used for intended infrastructure projects and instead siphoned off to unrelated shell companies.
Preliminary investigation indicates that funds were round-tripped through a complex web of shell firms, eventually ending up in foreign accounts or being used to service unrelated debts. The loans in question were primarily obtained between 2017 and 2020, and remain classified as non-performing assets (NPAs), leading to significant losses for lenders.
The ED confirmed that searches were conducted at multiple locations in Mumbai and Delhi last week, during which key digital evidence and financial records were seized.
Corporate and Legal Repercussions Expected
The Anil Ambani group has strongly denied wrongdoing, stating that all financial dealings were within the legal framework and the company is fully cooperating with investigators. However, sources within the ED suggest that further arrests and summons are likely in the coming weeks.
This development follows an increasing trend of regulatory crackdowns on high-value corporate defaulters in India, particularly after the PNB-Nirav Modi and IL&FS scandals.
The case has raised alarms within the banking sector, as the ED is reportedly examining the due diligence and approval process followed by the lending banks. Top executives from at least two PSU banks may also be summoned.
The arrest of Bhatia is likely to open a broader investigation into the role of company board members, statutory auditors, and possible political linkages behind loan sanctions.