The Enforcement Directorate (ED) on Thursday carried out an extensive search operation across 35 locations in Mumbai and Delhi, targeting companies and individuals linked to the Reliance Anil Dhirubhai Ambani Group (ADAG). The searches were conducted under the Prevention of Money Laundering Act (PMLA) in connection with a suspected ₹3,000 crore loan fraud involving Yes Bank.
According to officials aware of the developments, the operation spanned over 50 firms and more than 25 individuals associated with ADAG. These entities are alleged to be part of a complex network that facilitated the diversion of bank loans, originally granted by Yes Bank between 2017 and 2019, to unrelated shell companies and promoter-linked entities.
The ED’s investigation stems from two First Information Reports (FIRs) registered by the Central Bureau of Investigation (CBI) in September 2022, relating to separate loan facilities extended by Yes Bank to Reliance Home Finance Ltd (RHFL) and Reliance Commercial Finance Ltd (RCFL)—both subsidiaries of ADAG. Former Yes Bank chairman Rana Kapoor was named in both cases.
Sources said that financial regulators and institutions, including the Securities and Exchange Board of India (SEBI), the National Housing Bank (NHB), the National Financial Reporting Authority (NFRA), and Bank of Baroda, have provided key intelligence that further bolstered the ED’s case.
“Preliminary findings point to a deliberate and coordinated scheme to defraud public financial institutions by misrepresenting financial data, bribing bank officials, and routing funds through dubious channels,” said a senior official part of the investigation.
The agency suspects that Rana Kapoor and other Yes Bank officials may have accepted bribes in exchange for facilitating questionable loan approvals. “In some instances, we’ve found that Kapoor-linked entities received payments just prior to loan disbursements. This pattern indicates a likely bribe-for-loan arrangement,” another ED officer revealed.
The probe has uncovered serious irregularities in how loans were processed. According to the ED, Credit Approval Memorandums (CAMs) were allegedly backdated, and in several cases, no credit analysis or due diligence was performed. Loans were approved in violation of internal credit policies and were often disbursed on the same day as the loan application, or even before sanction.
Worryingly, a large portion of the sanctioned funds were later found to be diverted to shell companies or used for evergreening—a process where fresh loans are issued to repay earlier ones, thereby concealing non-performing assets.
Officials also cited “red flags” such as multiple borrowing entities sharing common addresses, overlapping directorships, and poor financial health. In some cases, borrowers lacked proper documentation, while others misrepresented their financials during the application process.
The ED is also investigating the abrupt rise in corporate loans by RHFL, which jumped from ₹3,742.60 crore in FY 2017–18 to ₹8,670.80 crore in FY 2018–19. This sharp spike has raised suspicions of loan inflation or fictitious lending practices.
Market regulator SEBI has already shared findings related to RHFL with the ED. While the full scope of the investigation is still unfolding, sources indicate that asset seizures, arrests, and chargesheets may follow if the laundering angle is firmly established.
The Reliance ADAG group has been contacted for comment. A spokesperson said that a formal statement would be issued soon.
With multiple government agencies collaborating, this case could become one of the largest financial fraud investigations involving corporate houses in recent years, drawing renewed attention to the governance lapses in India’s financial sector.
