CBI books Anil Ambani, Reliance Capital in ₹1,816 crore EPFO case. Here's what happened

The Central Bureau of Investigation (CBI) has registered an FIR against Reliance Capital Ltd (RCL) and its former chairman Anil D Ambani over allegations that the company caused a loss of ₹1,816.22 crore to the Employees' Provident Fund Organisation (EPFO) through investments in its non-convertible debentures.

The case originates from a complaint filed by the Union Ministry of Labour and Employment on July 21, alleging offences of cheating, criminal conspiracy and causing wrongful loss to the EPFO.

Ambani has denied any wrongdoing.

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WHAT IS THE CASE?

According to the complaint, Reliance Capital issued secured Non-Convertible Debentures (NCDs) during 2013 and 2014. Portfolio managers subsequently invested ₹2,500 crore of EPFO funds in these debentures, which were scheduled to mature in 2023 and 2024.

The ministry alleged that EPFO ultimately suffered a loss of ₹1,816.22 crore on these investments.

"The present complaint is being lodged on behalf of EPFO through its authorised officer pursuant to the approval of the competent authority in relation to the substantial loss suffered by the EPFO arising out of its investment in the secured Non-Convertible Debentures issued by Reliance Capital Limited and the subsequently discovered material indicating fraudulent conduct connected with such investment," the complaint said.

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WHAT PROMPTED THE CBI FIR?

The Labour Ministry said it filed the complaint after being informed by the Enforcement Directorate (ED) that it had found documentary evidence, along with a transaction audit conducted by BDO India LLP, indicating prima facie fraudulent transactions involving Reliance Capital and those managing the company between December 7, 2019, and December 6, 2021.

The complaint further alleged that fraudulent transactions had also occurred during earlier periods and contributed to the eventual collapse of Reliance Capital through the alleged siphoning of company funds.

It also cited the ED's findings of alleged irregular lending, diversion of funds, impairment of security and other transactions that require investigation.

"If established upon investigation, such conduct may have materially contributed to the financial deterioration of RCL, its inability to honour its obligation towards Debenture Holders, and the consequent loss of Rs 1,816.22 crore suffered by EPFO," the complaint alleged.

WHAT HAS ANIL AMBANI SAID?

Responding to the FIR, Ambani's spokesperson said the case pertains to Reliance Capital Ltd and noted that he served as a Non-Executive Director and Chairman of the company's board from 2005 until November 2021, when the Reserve Bank of India superseded the board and appointed an administrator.

"Anil Ambani denies any wrongdoing whatsoever, and reserves all rights available to him in law," the spokesperson said.

(With inputs from PTI)