YES Bank crisis: ED summons Anil Ambani in probe against Rana Kapoor

The Enforcement Directorate (ED) has summoned Reliance Group Chairman Anil Ambani in connection with the ongoing money-laundering probe against YES Bank co-founder and former chief executive officer Rana Kapoor. The Group is among the largest borrowers from the bank, with an exposure of around Rs 14,000 crore.
 
Confirming the development, an ED official said the agency was examining all the big borrowers of the bank, and the stressed loans sanctioned during Kapoor’s tenure. Ambani has been asked to join the probe on Monday (March 16). He will have to provide the details regarding the loans disbursed to his group, the terms and conditions and side agreements, if any, with the private lender, said the official.

The official said a significant portion of the bank’s loans to the construction sector was accounted for by the Anil Ambani-led group and the investigative agency wanted to understand the process of disbursing the loans.

An email sent to the Reliance Group spokesperson on Saturday went unanswered.

Sources said the federal agency had prepared a list of the top five borrowers, which were extended large credit facilities by the bank under Kapoor. "Most of these borrowers have defaulted and the loans have turned into bad debts. So, each of these accounts is under the radar. Their management and promoters will be examined and questioned in the coming weeks," said the official.

Last week, Reliance Group had said it had no direct or indirect exposure to the Kapoor family or any entities controlled by them. “The entire exposure to YES Bank is fully secured and is transacted in the ordinary course of business, and we are committed to honour our repayments to YES Bank,” the statement said.

Some of the other big defaulters to whom the private lender had advanced funds include Vodafone Idea, Dewan Housing Finance (DHFL), Infrastructure Leasing & Financial Services (IL&FS), Essel Group, CG Power, Cox and Kings, and Radius Developers. IL&FS, DHFL, and CG Power are already facing probe from various agencies for alleged irregularities in their books and diversion of funds.

The enforcement agency is probing Kapoor’s role in YES Bank’s bad debts of Rs 30,000 crore and whether the money was siphoned off and laundered to the 78 entities controlled by the bank’s co-founder.

The ED had last week told a special court under the Prevention of Money Laundering Act (PMLA) that it was investigating loans of over Rs 20,000 crore from the point of view of irregularities, quid pro quo, and diversion. The ED estimated that around Rs 42,000 crore turned non-performing assets of the bank’s total loans of about Rs 2.25 trillion. Kapoor is currently in ED custody and will be produced in court on Tuesday.

Last week, at a press briefing, Finance Minister Nirmala Sitharaman had highlighted the stressed corporates to which YES Bank had exposure. “The exposure of YES Bank to some of the very stressed corporates has been before 2014. These names are in public domain and I am not violating any customer privacy — Anil Ambani (Group), Essel Group, DHFL, IL&FS (and) Vodafone are some of the very stressed corporates to whom YES Bank has been exposed,” she had said.