ED Arrests Reliance Power CFO Over Bank Loan Fraud Allegations

The Enforcement Directorate (ED) has arrested Ashok Kumar Pal, the Chief Financial Officer (CFO) of Reliance Power Limited (RPL), in connection with a Rs 3,000 crore bank loan fraud involving companies under the Reliance Anil Dhirubhai Ambani Group. The arrest follows a money laundering investigation into alleged illegal diversion of loans disbursed by Yes Bank to group companies between 2017 and 2019. Pal was summoned to ED’s Delhi headquarters for questioning and was taken into custody late on Friday after the agency found sufficient grounds for his arrest. He is a close aide of industrialist Anil Ambani and is alleged to have played a crucial role in orchestrating the fraud.

The ED is investigating multiple facets of the fraud, including whether a quid pro quo existed in the loans, specifically the payment of bribes to bank officials, including Yes Bank promoters. On July 24, several ED teams conducted searches at more than 35 locations in Mumbai, concluding the operation on July 27. Following evidence collection, the ED has begun summoning all individuals involved, including Anil Ambani.

Pal, as CFO of RPL—a publicly listed company with over 75% of shares held by the public—allegedly played a pivotal role in diverting company funds. Investigations revealed that a board resolution empowered him and others to finalize, approve, sign, and execute all documents for Solar Energy Corporation of India (SECI)’s BESS (Battery Energy Storage System) tender and to leverage RPL’s financial capacity for the bid. During the probe, the ED discovered that Pal submitted a bogus bank guarantee of over Rs 68 crore to SECI with the intention to cheat the PSU. He reportedly oversaw the planning, funding, supervision, and concealment of the forged bank guarantee used in the tender.

The investigation further revealed that Pal played a role in selecting Biswal Tradelink Pvt Ltd (BTPL) to provide the fake bank guarantee. BTPL is a small company operating from a residential address without a credible bank guarantee record, and its director, Partha Sarathi Biswal, has already been arrested and is in judicial custody. Additionally, Pal allegedly facilitated diversion of funds through fake transport invoices and approved releases outside standard SAP/vendor workflows using Telegram and WhatsApp. The fraud extended to presenting a bank guarantee from FirstRand Bank, Manila, Philippines—a bank branch that does not exist in the country.

Moreover, Pal reportedly used a network of fake business guarantee rackets with spoofed bank domains to impersonate official banks in emails and letters. Domains such as s-bi.co.in, lndianbank.in, lndusindbank.in, pnblndia.in, psdbank.co.in, siliguripnb.co.in, Iobbank.co.in, and unionbankoflndia.co.in were employed to create the appearance of authenticity, despite being fraudulent. These domains were primarily used to mislead stakeholders into accepting forged instruments as genuine.

In response, Reliance Power clarified that it is a separate and independent listed entity with no business or financial linkages to Reliance Communications Limited (RCOM) or Reliance Home Finance Limited (RHFL). RCOM has been under the Corporate Insolvency Resolution Process since 2016, and RHFL has been fully resolved as per Supreme Court directives. Anil Ambani is not on the board of Reliance Power, and actions against RCOM or RHFL have no bearing on RPL’s governance, management, or operations.

In summary, the ED’s investigation and subsequent arrest of Ashok Kumar Pal highlight a complex Rs 3,000 crore bank loan fraud involving bogus guarantees, fake invoices, manipulation of SECI’s BESS tender, and misuse of spoofed bank domains. The probe underscores potential collusion, financial misappropriation, and systemic weaknesses, while RPL maintains its independence from other group companies. The case remains under active investigation, with further summonses expected for key stakeholders.