IDBI Bank declares Reliance Communications' loan account as fraud

IDBI Bank's Fraud Examination Committee – I has declared Reliance Communications Limited's (RCOM) loan account as "fraud" following a meeting on September 22, 2025. This re-classification comes after the previous "fraud" status was deactivated by the RBI in July 2023. The bank will report this to the Reserve Bank of India and initiate complaints with law enforcement agencies.

The fraud declaration stems from incidents including the misappropriation and diversion of bank loans between FY 2013-14 and FY 2016-17, totaling INR 15,436 crore. It was observed that INR 13,668 crore (approximately 44%) of the INR 31,580 crore received from banks by RCOM, Reliance Telecom Ltd (RTL), and Reliance Infratel Ltd (RITL) was used for loan repayments and other obligations to banks/FIs, with INR 12,692 crore (approximately 41%) paid to connected parties.

Additionally, transactions with Netizen Engineering Pvt. Ltd. from FY 2015-16 involved RCOM paying INR 5,525 crore in capex advances. Concerns were raised regarding the financial background of Netizen and its close connection to RCOM. Invoice financing of RITL in July 2015 also revealed the discounting of bills worth INR 8,515 crore for RCOM and INR 1,041 crore for RTL, primarily used for payments to connected parties, indicating potential round-tripping of loans.