CBI Arrests Former CEOs of Reliance Finance Firms in ₹7,623 Crore Bank Fraud Case

The Central Bureau of Investigation (CBI) arrested former chief executive officers of two Reliance Group finance companies on Monday in connection with separate cases involving an alleged fraud of ₹7,623 crore against multiple public sector banks, officials said.

The agency arrested Devang Mody, former director and CEO of Reliance Commercial Finance Limited (RCFL), and Ravindra Sudhalkar, former executive director and CEO of Reliance Home Finance Limited (RHFL).

According to a CBI spokesperson, the alleged fraud in RCFL caused a loss of ₹4,097 crore to 13 public sector banks, while the RHFL case involved a loss of ₹3,526 crore to 10 public sector banks.

The investigation revealed that Mody, who served as CEO of RCFL from April 2017 to December 2018, was a key decision-maker responsible for managing the company's operations. The CBI stated that he approved loans to intermediary and conduit companies despite knowing such lending violated Reserve Bank of India (RBI) guidelines and the conditions governing borrowings from public sector banks.

Similarly, Sudhalkar, who served as ED and CEO of RHFL from October 2016 to March 2022, was also a key decision-maker. The agency said he approved loans to intermediary and conduit companies despite such lending being contrary to the company's lending policies, National Housing Bank (NHB) and RBI guidelines, and the borrowing conditions set by public sector banks.

The CBI alleged that the accused diverted funds borrowed by RCFL and RHFL to other Reliance ADA Group companies, including Reliance Capital Limited, Reliance Infrastructure Limited, and Reliance Power Limited. This caused a combined wrongful loss of ₹7,623 crore to the lending banks and corresponding wrongful gain to themselves and related entities.

The agency has registered seven first information reports (FIRs) against Reliance Communications Limited (RCom), RHFL, RCFL, and Reliance Telecom Limited (RTL) based on complaints from various public sector banks and the Life Insurance Corporation of India (LIC).

So far, the CBI has arrested five persons in Reliance ADA Group-related cases. It filed its first chargesheet in the RCom case on May 29 against 16 accused, including the company, five senior executives of RCom, and 10 bank officials.