RCom’s SBI Loan Declared Fraud: Here's What You Need To Know
Recently, India’s biggest bank, SBI, labelled the Reliance Communications (RCom) SBI loan account as “fraud”. This raises serious questions about corporate governance and financial accountability. However, this is not the first time that RCom has captured headlines.
Reliance Communications, a part of Anil Ambani’s business empire, has been under insolvency since 20191. But now, this fraud allegation is signalling a strong commitment of Indian banks towards tackling Non-Performing Assets (NPAs) and other questionable transactions. This bank fraud also raises some questions about the corporate governance of Reliance Group, led by Anil Ambani. Investors of the Reliance group and the financial market are closely following the case to understand the impact of the allegation and its consequences in the market.
This blog takes a keen look at the details of the case to enrich investor understanding of what the future holds for the group.
SBI Tags Reliance Communication Loan As Fraud
The episode began on July 1, 2025, when RCom disclosed to the stock exchanges that SBI had officially classified its loan account as a “fraud” account. As of March 2025, the total debt of the company stood at INR 40,400 crores2.
SBI marked the loan as fraudulent and flagged potential promoter-level violations, which were escalated to regulatory and investigative agencies. In the letter to RCom, SBI stated that it had discovered an irregularity in the loan use that involved a complex network of fund transfers across group companies.
Under Indian banking regulations, once a loan account is declared fraudulent, the borrower is banned from taking loans from most financial institutions for at least five years3. This RCom case has also been passed on to investigative agencies. Moreover, the lender informs the RBI within 21 days of detection, followed by a report to the CBI or the police4.
Although this is not the first time RCom has come under scrutiny for bank fraud under the RBI Guidelines, it is important to note the causes behind this classification to ensure optimal investing decisions.
Reasons Behind The Fraud Classification
The accusation was made after extensive forensic audits of the company’s financial records. Here are some of the main reasons that led to this latest bank fraud:
1. Non-adherence to Loan Terms:
SBI had raised red flags multiple times, sending notices to RCom and its promoters asking for clarity on these issues. However, the explanations were not satisfactory to consider.
2. Misuse of Documentation:
The forensic audit discovered some instances where sales invoices and other financial documents were misused to manipulate the actual flow and use of funds.
3. Forensic Audit Findings:
Back in 2020, a forensic audit by BDO noticed various discrepancies in fund utilisation, particularly in transactions from the past. These audit findings of Anil Ambani's companies added more to the suspicion.
4. Alleged Diversion of Funds:
The funds that were sanctioned for specific purposes were allegedly transferred to related parties without lender approval or used for inter-company transactions.
For example, an INR 250 crore loan meant for statutory dues was internally diverted as an inter-corporate deposit to Reliance Communications Infrastructure (RCIL)5.
5. Inadequate Clarification:
The SBI Loan committee sent multiple show-cause notices to RCom, giving them chances to clarify the accusations of suspected fund misuse. However, their replies were found inadequate as per the regulations.
6. Historical Suspicious Activities:
This is not the first time that RCom has been in the news because of its finances. Back in 2019, RCom filed for voluntary bankruptcy under the Insolvency and Bankruptcy Code (IBC). Later in 2024, Canara Bank also flagged RCom’s Loan account as fraudulent.
While the market believes that Anil Ambani’s vision and ideas were bold, the execution was a failure that led to this mess6.
Also Read: Understanding The New-Age Cyber Frauds
Impact On Reliance Group Companies And Market Sentiment
After this latest bank fraud news, the attention of the market swiftly shifted towards the other Anil Ambani companies of the Reliance Group. Shares of companies like Reliance Power and Reliance Infrastructure also fell, following the news. All the other companies moved fast to clear the buzz to their investors and assured them that their operations and finances would not be affected by the ongoing scrutiny.
The companies have also explicitly stated that Anil Ambani is not on the Board of Reliance Infrastructure or Reliance Power.7 This statement was issued in clarification of exchanges following SBI’s RCom fraud declaration.
Although it is quite common for negative news about one group of companies to cause short-term jitters in their related stocks. In the past five trading days, the Reliance Power share and Reliance Infrastructure share encountered short selling and fell around 7-8%.
Reliance Power slipped 4.8% to INR 64.75 as of 3 July 2025. The chart below shows the current movement of the stock8.
Moreover, Reliance Infrastructure hit a 5% lower circuit on the Bombay Stock Exchange to hit INR 377.45 as of 3 July 20259. The chart below shows the current movement of the stock.
This negative market sentiment shows that even if these Reliance Group companies are technically not involved in the issue, being linked to the Anil Ambani group is enough to drive volatility. This is not just another news of a popular company failing in the market; this is a case for investors to understand the importance of adhering to the fundamentals and due diligence in the market.
Conclusion
This SBI Loan account news has shaken investor confidence across other Anil Ambani companies. The volatility in the prices of Reliance shares, even of those that are not directly involved, shows how sensitive markets can be to such promoter-linked news or regulatory actions. That’s why diversification is a crucial component of investing. Investing in shares is a great way to build wealth, but shares will never give you enough security. Explore more options like Corporate Bonds and Secured Debt Instruments (SDIs) that offer steady returns with lower risk.
Grip Invest provides such curated, high-yield opportunities without the noise of the stock market. Check out and start building a more balanced portfolio!
FAQs on SBI Loan Fraud
1. How much loan has Reliance Communications (RCom) taken?
As of March?2025, Reliance Communications had total borrowings of roughly over INR 40,000 crores, including both bank loans and debt instruments. The company has been in financial distress for several years, and many of these loans have turned into non-performing assets (NPAs) for banks, triggering legal and recovery proceedings.
2. How much loan is on Adani?
Adani Group’s total debt across its companies is estimated to be around INR 2.9 lakh crore in 2025. Adani Enterprises alone has around INR 90,000 crore in debt. However, the group has been reducing debt steadily and improving its finances.
3. Does Mukesh Ambani have any loans?
Mukesh Ambani personally doesn’t have any known loans. His company, Reliance Industries, has manageable debt levels and remains financially healthy, with strong earnings and a low debt-to-profit ratio.
References:
1. The Economic Times, accessed from: https://economictimes.indiatimes.com/industry/telecom/telecom-news/reliance-communications-sbi-loan-account-fraud-anil-ambani-rbi-report-the-one-reliance-company-that-failed/articleshow/122201078.cms?from=mdr
2. The Hindustan Times, accessed from: https://www.hindustantimes.com/business/sbi-classifies-anil-ambani-led-reliance-communications-loan-account-as-fraud-what-does-it-mean-101751453753342.html
3. The Hindustan Times, accessed from: https://www.hindustantimes.com/business/sbi-classifies-anil-ambani-led-reliance-communications-loan-account-as-fraud-what-does-it-mean-101751453753342.html
4. The Hindu, accessed from: https://www.thehindu.com/business/sbi-classifies-reliance-communications-loan-as-fraud-reports-anil-ambani-to-rbi/article69764470.ece
5. The Hindu, accessed from: https://www.thehindubusinessline.com/companies/sbi-forensic-audit-rcom-loan-fraud-details/article69763708.ece
6. The Economic Times, accessed from: https://economictimes.indiatimes.com/markets/stocks/news/rpower-reliance-infra-shares-tumble-up-to-5-after-sbi-flags-rcom-loan-as-fraud/articleshow/122220349.cms?from=mdr
7. Financial Express, accessed from: https://www.financialexpress.com/business/industry-reliance-infrastructure-and-reliance-power-distance-themselves-from-reliance-communication-amid-ongoing-dispute-with-sbi-3901828/
8. The Economic Times, accessed from: https://economictimes.indiatimes.com/markets/stocks/news/rpower-reliance-infra-shares-tumble-up-to-5-after-sbi-flags-rcom-loan-as-fraud/articleshow/122220349.cms?from=mdr
9. The Economic Times, accessed from: https://economictimes.indiatimes.com/markets/stocks/news/rpower-reliance-infra-shares-tumble-up-to-5-after-sbi-flags-rcom-loan-as-fraud/articleshow/122220349.cms?from=mdr
Want to stay at the top of your finances?
Join the community of 4 lakh+ investors and learn more about Grip Invest, the latest financial knick-knacks, and shenanigans in the world of investing.
Happy Investing!
Disclaimer - Investments in debt securities/municipal debt securities/securitised debt instruments are subject to risks including delay and/ or default in payment. Read all the offer related documents carefully. The investor is requested to take into consideration all the risk factors before the commencement of trading.
This communication is prepared by Grip Broking Private Limited (bearing SEBI Registration No. INZ000312836 and NSE ID 90319) and/or its affiliate/ group company(ies) (together referred to as “Grip”) and the contents of this disclaimer are applicable to this document and any and all written or oral communication(s) made by Grip or its directors, employees, associates, representatives and agents. This communication does not constitute advice relating to investing or otherwise dealing in securities and is not an offer or solicitation for the purchase or sale of any securities. Grip does not guarantee or assure any return on investments and accepts no liability for consequences of any actions taken based on the information provided. For more details, please visit www.gripinvest.in
Registered Address - 106, II F, New Asiatic Building, H Block, Connaught Place, New Delhi 110001
