ED Arrests Anil Ambani’s Close Aides Amitabh Jhunjhunwala, Amit Barpa in ₹1000s Crore Money Laundering Case

New Delhi: On Wednesday, the Enforcement Directorate (ED) arrested Amitabh Jhunjhunwala and Amit Bapna, both former Reliance Group senior executives, in connection with an alleged bank loan fraud and money laundering case involving crores of rupees. 

The two were arrested under the Prevention of Money Laundering Act (PMLA) after being questioned by the agency. Officials said they were later produced before a court, where the ED sought their custody for detailed inquiry.

Alleged Fraud Through Shell Companies

According to the "grounds of arrest" document, the ED discovered a "pre-conceived and well-planned scheme" to divert funds from RHFL and RCFL. The cash were allegedly carried through a network of shell or fake firms affiliated to the Anil Ambani Group in the name of corporate loans.

The money laundering case comes from FIRs filed by the Central Bureau of Investigation (CBI) and complaints from several banks.

Investigators claim that loans made to these businesses eventually became non-performing assets (NPAs), resulting in large losses for banks, investors, and public institutions.

Jhunjhunwala is accused of making critical decisions in loan approvals, fund disbursement, and cash flow monitoring, as well as knowingly sanctioning loans to firms claimed to be part of the group's internal network despite knowing their poor financial position.

The ED alleges he had a "prominent role" in the diversion and stacking of funds, assisting in concealing their origin and portraying them as genuine transactions. In addition, Bapna's role in these transactions is being investigated.

The ED has charged the accused under Sections 3 and 4 of the PMLA, which address money laundering and its punishment. The government claims to have acquired evidence, including emails, financial records, and witness statements, linking them to the alleged offense.

Why ED Made the Arrest

The agency justified the arrests by noting the necessity to trace additional proceeds of crime and avoid any potential tampering with evidence or influence on witnesses. It also emphasized the need for custodial questioning to identify other defendants in the case and confront them with seized documents and digital evidence. Furthermore, the ED raised the prospect of absconding, notably in the instance of Jhunjhunwala, who is a non-resident Indian with a Dubai Golden visa.

Multi-Bank Exposure

The case comprises accusations from multiple major banks, including the State Bank of India, Punjab National Bank, Bank of Baroda, Canara Bank, Yes Bank, Union Bank of India, and Bank of Maharashtra, highlighting the scale and gravity of the alleged fraud.

Jhunjhunwala, who was Vice Chairman and Director of Reliance Capital Ltd from 2003 until 2019, is regarded Anil Ambani's close aide. Reliance Capital is the parent firm for Reliance Home Finance Ltd (RHFL) and Reliance Commercial Finance Ltd (RCFL).

Amit Bapna, the second accused, worked as a director at RHFL.