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The State Bank of India (SBI) has classified the loan account of Anil Ambani’s Reliance Communications (RCom) as ‘fraud’, the bankrupt telecom company claimed.
RCom filed a securities filing on Tuesday, disclosing the move of India’s biggest lender. Last year, state-run Canara Bank also tagged the RCom loan account as ‘fraud’, a decision that the Bombay high court stayed.
Reliance Communications is part of the group led by Anil Ambani, the brother of India’s richest person, Mukesh Ambani, who chairs the oil-to-telecoms conglomerate Reliance Industries. According to Reuters, Reliance Communications disclosed in April that as of March 2025, it had a total debt of ₹40,400 crore.
What does SBI tagging Anil Ambani’s Reliance Communications loan account as ‘fraud’ mean?
Under Indian banking laws, once an account is reported as fraudulent, it is referred to enforcement agencies for criminal action, and the borrower is barred from securing any more finance from banks and other regulated financial institutions for an initial period of five years.
The SBI classified the Reliance Communications loan account as ‘fraud’ after finding alleged diversion of loan funds in transactions dating back to 2026.
The SBI said it gave Anil Ambani and the company several chances in the past two years to respond to the allegations of fraud in loans taken out in 2016 from Indian banks that were subsequently classified as bad or non-performing, but found their replies “insufficient”.
SBI’s letter also said it would report Anil Ambani to the Reserve Bank of India, in compliance with Indian banking regulations. Ambani was a director of Reliance Communications, which is currently undergoing insolvency proceedings.
In the filing, Reliance Communications said that the insolvency proceedings protect it from orders by any other authority or court of law.
“Legal advice is being sought on the way forward with respect to this development,” the company said.
