New Delhi, September 6, 2025 — Bank of Baroda (BoB) has formally declared the loan accounts of Reliance Communications (RCom) and its former non-executive director Anil Ambani as fraud. The move aligns BoB with the State Bank of India (SBI) and the Bank of India (BoI), both of which previously classified the accounts as fraudulent after forensic investigations revealed fund diversion and misuse.
Why the Banks Took Action
BoB stated that its decision followed forensic audits and investigations into alleged irregularities by RCom. Findings included diversion of loan proceeds, unauthorised related-party transactions, and questionable inter-corporate deposits.
According to filings seen by the Economic Times, BoB issued its first show-cause notice on 2 January 2024, held a personal hearing with Ambani on 18 July 2025, and issued a second notice on 29 August 2025 before making the declaration.
BoB disclosed an exposure of ₹2,462.50 crore, including ₹1,600 crore in loans and ₹862.50 crore in lines of credit. As of 28 August 2025, more than ₹1,656 crore remained unpaid, the bank said.
Previous Steps by SBI and Bank of India
SBI, India’s largest lender, flagged RCom’s account in June 2025, citing suspected fund diversion dating back to 2016. The bank also reported Anil Ambani’s role to the Reserve Bank of India (RBI), according to Reuters.
On 24 August 2025, BoI followed suit, declaring both RCom and Ambani’s accounts as fraudulent. In response, Ambani said in a statement that the actions had “selectively singled out” him without adequate justification.
Wider Legal and Regulatory Fallout
The Central Bureau of Investigation (CBI) has already registered a case against Ambani and RCom, acting on SBI’s complaint. Raids were conducted at Ambani’s residence in Mumbai and multiple RCom offices in late August 2025, Reuters reported.
This comes after Canara Bank also labelled RCom’s account as fraud in early 2024. That decision was temporarily stayed by the Bombay High Court during insolvency proceedings.
RCom’s Response and Insolvency Context
RCom, which entered the Corporate Insolvency Resolution Process (CIRP) in 2019, maintains that these loan accounts fall under insolvency proceedings and should be resolved within the Insolvency and Bankruptcy Code (IBC) framework. A company spokesperson told NDTV that RCom “remains protected from external litigation under the moratorium provided during CIRP.”
Ambani, meanwhile, has consistently distanced himself from RCom’s daily operations. “I served only as a non-executive director between 2006 and 2019 and had no involvement in the company’s operational or financial decisions,” he said, according to Hindustan Times. He further alleged that lenders have targeted him in a staggered and selective manner.
Implications for India’s Banking Sector
Analysts say the coordinated actions by multiple state-owned banks demonstrate a tightening approach toward high-profile defaults and alleged fraud cases. “Public sector banks are increasingly under pressure to show accountability and transparency in handling large non-performing assets,” said Dr. Raghav Menon, a banking law expert at the National Law School of India University.
However, legal experts caution that until insolvency proceedings conclude, enforcement of fraud classifications against companies like RCom may remain contested in court.
Rupee Crashes to Record Low of ₹88.27 Against Dollar: Check Details
Conclusion
The classification of Reliance Communications and Anil Ambani’s loan accounts as fraud by three of India’s largest public sector banks marks a significant escalation in the country’s efforts to address corporate financial misconduct. With legal battles already under way, the outcome of insolvency and criminal proceedings will determine the final impact on creditors, regulators, and Ambani himself.
