Anil Ambani Appeals Against SEBI Order Barring Access To Capital Markets Over Alleged Funds Diversion

Mumbai: Industrialist Anil Ambani has filed an appeal with the Securities Appellate Tribunal (SAT) challenging the market regulator SEBI order barring him from the securities market for alleged diversion of funds from Reliance Home Finance.

The Securities and Exchange Board of India (SEBI) had passed orders in August barring Ambani from the securities markets for five years and imposed Rs 25 crore penalty for orchestrating alleged funds diversion from Reliance Home Finance.

The tribunal will hear Anil Ambani appeal for admission of the case on October 18 contesting the SEBI order and seeking a stay on his debarment and the Rs 25 crore penalty.

The market regulator had also imposed penalty on Anil Ambani son Anmol Ambani for failing to follow due diligence while approving corporate loans in the Reliance Home Finance case.

SEBI had hefty fines of Rs 25 crore on Anil Ambani and barred the industrialist with 24 others including three key employees from accessing the securities market for five years.

The restrained entities include former key officials of RHFL – Amit Bapna, Ravindra Sudhalkar and Pinkesh R Shah. The regulator levied a fine of Rs 27 crore on Bapna, Rs 26 crore on Sudhalkar and Rs 21 crore on Shah.

The SEBI probe had revealed diversion of funds from Reliance Home Finance Ltd and lent to lent to other Reliance ADAG companies, including Reliance Capital, without necessary oversight.

The investigations into the alleged irregularities in diversion of funds from Reliance Home Finance led the market regulator to the role of Anmol Ambani on the board of Reliance Home Finance had approved loans labelled as "general-purpose corporate loans" (GPCL) despite a clear directive from the company’s board to halt such loan approvals.

The market regulator investigations concluded that key managerial personnel including Anil Ambani siphoned off funds from the listed company (RHFL) by structuring them as ‘loans’ to credit-unworthy conduit borrowers, and in turn, to onward borrowers, all of whom were found to be ‘promoter-linked entities’.

SEBI order also restrained Ambani and his associates from being associated with any listed company as a director or key managerial personnel (KMP) for five years.