State Bank of India has decided to classify the loan account of Reliance Communications Ltd. as ‘fraud', a move that dates back to transactions from August 2016, according to an exchange notification.
The bank will also report the name of Anil Dhirajlal Ambani, erstwhile director of the defunct telecom operator and head of the Anil Ambani-led Reliance Group, to the Reserve Bank of India in line with regulatory requirements for key management personnel involved in such accounts.
This has come as RCom is currently under the corporate insolvency resolution process as per the Insolvency and Bankruptcy Code.
The company clarified that the resolution plan for its insolvency has already been approved by its committee of creditors and is awaiting final approval from the National Company Law Tribunal.
According to regulatory guidelines, once a loan account is declared as fraud, the bank must inform the RBI within seven days and, if the amount exceeds Rs 1 crore, file a complaint with the Central Bureau of Investigation within 30 days of notifying the RBI.
The move could potentially lead to further investigations into the matter.
Neither SBI nor Anil Ambani has issued a public response regarding the latest developments.
RCom emphasised that, as the company is under a corporate insolvency resolution process, its business and assets are managed by a court-appointed resolution professional, and the board's powers are currently suspended.
Anil Ambani, who led RCom during the period in question, is the younger brother of Mukesh Ambani.
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