New Delhi, Jul 2 (PTI) State Bank of India has decided to classify the loan account of beleaguered telecom firm Reliance Communications as "fraud" and to report the name of its erstwhile director -- Anil Ambani to the Reserve Bank of India (RBI), according to a regulatory filing.

Reliance Communications in a regulatory filing said that it has received a letter dated June 23, 2025 from the State Bank of India (SBI) to this effect.

According to the filing, Reliance Communications (RCom) and its subsidiaries received a total loan of Rs 31,580 crore from banks.

The Fraud Identification Committee of the bank has found deviation in utilization of the loans involving complex web of fund movements across multiple group entities.

The letter marked to Reliance Communications and its erstwhile director Anil Ambani stated that SBI has decided to report the loan account of the company as "fraud" and to report the name of Anil Ambani to the RBI, as per the extant RBI guidelines, the filing said.

RCom is at present going through a liquidation process.

The committee found that out of the total loan, Rs 13,667.73 crore, about 44 per cent, was utilized for the repayment of loans and other obligations.

An amount of Rs 12,692.31 crore, 41 per cent of total loan, was utilized to pay connected parties.

According to the filing, Rs 6,265.85 crore was used for repaying other bank loans and Rs 5,501.56 crore was paid to related or connected parties which were not aligned with sanctioned purposes.

Further, a Rs 250-crore loan from Dena Bank (meant for statutory dues) was not utilized as per the sanctioned use. The loan was diverted to RCom Group company Reliance Communications Infrastructure Ltd (RCIL) as an Inter-Corporate Deposit (ICD) and was later claimed to repay an External Commercial Borrowing (ECB) loan.

The committee found that a loan of Rs 248 crore was sanctioned by IIFCL for meeting capital expenditure but RCom paid Rs 63 crore to Reliance Infratel Ltd (RITL) and Rs 77 crore to RIEL for repayment of loans.

"But instead of transferring the fund directly to these companies it was routed through RCIL, reason for that has not been given by management or by Anil Ambani. These (Dena Bank and IIFCL loan use) appear to be misappropriation of funds and breach of trust," the report said.

The committee observed potential routing of bank loans by RCom Group including mobile tower firm Reliance Infratel Ltd (RITL) telecom service company Reliance Telecom Ltd (RTL), Reliance Communications Infrastructure Ltd (RCIL), Netizen, Reliance Webstore (RWSL) etc.

The report said RCom, RITL, and RTL engaged in ICD (inter-corporate deposit) transactions totaling Rs 41,863.32 crore of which only Rs 28,421.61 crore was traceable.

RCom used a Rs 100-crore intraday limit to cycle funds through group entities including RWSL, RTL, RCIL multiple times in a single day.

"These transactions do not appear to be genuine or conducted in a normal course of business. It appears that RCom has utilized intra-day limits to finance RWSL to pay collection proceeds worth Rs 1,110 crore. As a result debtors of RTL got reduced by that extent... transactions can be termed as manipulation of books of accounts through fictitious accounts," the report said.

The committee raised a question on funds transactions involving Netizens as " an attempt of diversion of funds by manipulation of books of accounts through fictitious account/fictitious entries." PTI PRS DRR DRR

Fraud classification: loan account reported and former director named to RBI under banking regulatory reporting rules. Classification of the loan account as fraud and corresponding reporting obligations follow the committee's finding that loans were diverted from sanctioned purposes through complex intra group movements, inter corporate deposits and intraday cycling, with payments to connected parties and partial traceability of transactions indicating potential misappropriation, breach of trust and manipulation of books.